The Rise in Global Sanctions - Explained

As global tensions rise, more and more businesses are turning their attention to their overseas counterparts. The increase in geopolitical events and their ripple effect has meant risk officials must be tuned into the threat of financial crime. 

Now, more than ever, the acknowledgement of how serious the risk that accompanies unrest around the world is of extreme importance. The gravity of the situation is what has propelled the UK to expand its list of sanctioned countries, in an attempt to protect businesses from the impact of financial crime. 

But, despite the government's efforts, businesses are still responsible for not just protecting themselves, but maintaining compliance and following regulators’ requirements. 

Keep reading to discover how your business can be kept safe and compliant with Red Flag Alert, and dive into the details of the rise in global sanctions.

The UK’s Current Sanctioned Countries

Financial sanctions are an essential tool in international diplomacy, employed to enforce compliance with various regulations and policies. 

They are often imposed to address issues ranging from human rights violations to nuclear proliferation and terrorism. The following list provides a comprehensive overview of UK financial sanctions guidance across different countries and regions, highlighting the diverse range of issues addressed by these measures.

These financial sanctions are related to a specific country or terrorist group and are highlighted as ‘regimes’. The UK will automatically impose financial sanctions outlined by the United Nations Security Council, as well as financial sanctions created by the UK Government.

The guidance on financial sanctions pertaining to Afghanistan reflects the evolving geopolitical landscape and efforts to stabilise the region.

The recent guidance on Belarus underscores international concerns and efforts to address political unrest and human rights abuses in the country.

Financial sanctions guidance regarding Bosnia and Herzegovina demonstrates ongoing efforts to promote stability and address issues related to governance and corruption.

The guidance on Burundi highlights the international community's response to political instability and human rights violations in the region.

Financial sanctions guidance on the Central African Republic reflects efforts to address conflict and instability in the region.

The guidance on financial sanctions related to chemical weapons underscores international efforts to prevent the use and proliferation of such weapons.

Financial sanctions guidance on counter-terrorism demonstrates global cooperation in combating terrorist financing and activities.

The recent guidance on cyber-related financial sanctions reflects growing concerns about cyber threats and attacks worldwide.

Financial sanctions guidance on North Korea highlights efforts to address nuclear proliferation and illicit activities by the regime.

The guidance on the Democratic Republic of the Congo reflects ongoing efforts to promote stability and address human rights abuses in the region.

Financial sanctions guidance on global anti-corruption efforts underscores the importance of combating graft and promoting transparency in international transactions.

The recent guidance on global human rights sanctions reflects the international community's commitment to addressing human rights abuses worldwide.

Financial sanctions guidance on Guinea highlights efforts to address political instability and governance challenges in the country.

The guidance on Guinea-Bissau reflects ongoing efforts to promote stability and address issues related to governance and corruption.

Financial sanctions guidance on Haiti demonstrates international efforts to support democracy and address political instability in the country.

Financial sanctions guidance on international counter-terrorism reflects concerted global efforts to combat terrorist financing and activities.

The recent guidance on Iran underscores efforts to address nuclear proliferation concerns and promote diplomatic solutions.

Financial sanctions guidance on ISIL and Al-Qaida organisations reflects ongoing efforts to combat terrorism and extremist activities worldwide.

The guidance on Lebanon highlights efforts to address political assassinations and promote stability in the region.

Financial sanctions guidance on Libya reflects efforts to address conflict and instability in the region.

The guidance on Mali reflects ongoing efforts to promote stability and address security challenges in the region.

Financial sanctions guidance on Myanmar underscores international efforts to address human rights abuses and support democratic transition in the country.

The guidance on Nicaragua highlights international concerns regarding governance and human rights in the country.

The recent guidance on Russia reflects international responses to various geopolitical challenges and human rights concerns.

Financial sanctions guidance on Somalia reflects efforts to address instability and promote peacebuilding in the region.

The guidance on South Sudan reflects ongoing efforts to address conflict and humanitarian challenges in the country.

Financial sanctions guidance on Sudan reflects efforts to support peace and stability in the region.

The recent guidance on Syria underscores international efforts to address conflict, humanitarian crises, and human rights abuses in the country.

Financial sanctions guidance on UK freezing orders highlights efforts to prevent the movement of illicit funds and assets.

The guidance on unauthorised drilling activities reflects efforts to protect the environment and regulate natural resource exploitation.

Financial sanctions guidance on Venezuela reflects international efforts to address political and economic crises in the country.

The recent guidance on Yemen underscores international efforts to address humanitarian crises and promote peace in the region.

Financial sanctions guidance on Zimbabwe reflects international efforts to address governance challenges and promote democracy in the country.

Global Events in 2023 Which Triggered a Rise in Sanctions

In 2023, a number of events influenced a rise in sanctions across the UN and the UK, including:

North Korea Sanctions

In November 2023, the UK government announced a significant partnership with the Republic of Korea. This collaboration includes a defence agreement, marking the first time both nations will work together to enforce UN Security Council sanctions on North Korea.

This comes as the UK condemns North Korea's destabilising behaviour, including missile tests and arms sales to Russia. After concerns being reiterated across international forums, the UK has called for North Korea to engage in diplomacy, alongside the denuclearisation of the Korean Peninsula as a whole. 

This has also been influenced by the UK’s concern regarding North Korea’s human rights abuses and illicit activities, leaving the country still in the sanctions regime. As this situation is ongoing, the UK will continue to monitor North Korea and regularly vocalise the need for international cooperation. 

Iran Sanctions

The UK has introduced new sanctions against Iran to hold the country and its leaders accountable for their actions. 

These sanctions involve travel bans and asset freezes for specific individuals and entities, intending to discourage Iran's negative actions by expanding its sanctions authority, targeting activities that undermine peace, stability, and security, as well as the proliferation of weapons.

The UK is working with the US to impose these sanctions, initially focusing on key figures in Iran's Islamic Revolutionary Guard Corps and individuals linked to support for Hamas and Palestinian Islamic Jihad.

Russia Sanctions

Historically, Russia has faced sanctions from the UK and other countries for various reasons, including the annexation of Crimea, their alleged interference in elections, and several human rights abuse accusations. 

However, most notably in recent times, Russia’s invasion of Ukraine has become a frequently discussed topic and has led to further sanctions by the UK. 

Acknowledging the one-year mark in the war instigated by Russia in Ukraine, the UK implemented a new round of sanctions against Russia. Detailed on December 15, these sanctions include restrictions on correspondent banking for certain lenders and a ban on importing specific Russian metals. 

Notably, JSC Bank Novikombank faces asset freezes, trust services sanctions, and correspondent banking prohibitions. Additionally, other Russian banks like VTB Bank PJSC, Gazprombank JSC, Russian Agricultural Bank, PJSC Rosbank, and JSC Tinkoff Bank are now prohibited from engaging in correspondent banking relationships.

Other sanctions were agreed within the G7 on December 6, including a ban on Russian diamonds, effective January 1, 2024. The UK government also announced new sanctions targeting 46 individuals and groups involved in Russia's military supply chain.

Belarus Sanctions

The UK has imposed sanctions on Belarus to push for the respect of democratic principles, human rights, and regional stability. 

These sanctions aim to pressure the Belarusian government into upholding democratic institutions, separating powers, and adhering to the rule of law. Additionally, Belarus is urged to refrain from suppressing civil society and to investigate cases of disappearances thoroughly, with compliance with international human rights laws and efforts to stabilise Ukraine also emphasised. 

The sanctions aim to deter actions that threaten peace, security, and stability in Europe. By replacing relevant EU legislation and related UK regulations, these measures signal the UK's commitment to promoting accountability and respect for human rights in Belarus. 

The sanctions list includes designations of individuals and entities targeted by these measures, reflecting the UK's determination to address issues of concern in Belarusian governance and regional affairs.

Hamas Sanctions

Following decades of conflict, Hamas launched an attack on Israel on October 7th, which responded to the assault by conducting air strikes against Hamas, who are believed to be in Gaza, amongst Palestinians. 

After no resolution between the internationally recognised terrorist group Hamas and Israel, the IDF launched a ground attack in Gaza. They aim to "destroy Hamas' governing and military capabilities and bring the hostages home." 

As the conflict has progressed and tensions between Hamas and Israel have escalated, the United States and the EU have announced sanctions against Hamas and other Iran-aligned groups, due to their terrorist status. Meanwhile, the US and France have introduced visa restrictions against some Israeli settlers involved in West Bank violence.

What to Expect - Three Growing Geopolitical Concerns in 2024

Sanctions will always shift and change, as ongoing events run their course. But, regardless of the speed at which they change, businesses must keep themselves informed, and it is solely their responsibility to do so. 

To remain compliant, be in the know with our summary of the three key growing geopolitical concerns that could impact business operations in 2024.

Russia-NATO Tensions

The ongoing conflict between Russia and Ukraine poses significant geopolitical risks, affecting capital flows, trade, and global commodity markets. Tensions between NATO and Russia are at their highest since the Cold War, with sanctions and military support to Ukraine escalating the situation.

Cyber Attacks

The frequency and severity of cyberattacks are increasing, posing threats to national security and critical infrastructure. Recent attacks on government websites and data breaches highlight the vulnerability of digital systems, with potential impacts on financial markets and economies.

US-China Strategic Competition

Geopolitical tensions between the US and China, driven by military presence, technological advancements, and trade disputes, are significant risks. The complex relationship between the two superpowers affects global trade and economic stability, with the potential for further escalation.

Why AML Procedures Play a Fundamental Part in Sanctions

Anti-Money Laundering (AML) procedures are paramount in sanction compliance for various reasons. 

Beyond the need to maintain compliance in accordance with regulator requirements, AML processes are instrumental in helping businesses identify and mitigate the risk of financial transactions being exploited for illicit purposes, including sanctions evasion. 

Robust AML measures also enable businesses to discern suspicious activities, such as transactions involving sanctioned entities or individuals, and promptly take necessary actions to prevent potential violations.

Remaining compliant whilst continuously monitoring portfolios, and staying on top of changes in sanctions is a heavy-duty task for any business. For an AML process to work appropriately without exhausting resources within a company, a strong data provider is often required. 

Solve Compliance Problems With Red Flag Alert’s AML Solution

Red Flag Alert digital suite stands out as the optimal choice for any business looking to streamline AML processes, thanks to our industry-leading tools and comprehensive data analysis, greatly enhancing AML procedures. 

Not only do we furnish businesses with extensive data on both businesses and individuals, but we also enable them to conduct thorough due diligence and flag potential red flags associated with sanctions evasion in just a few clicks. 

This encompasses real-time data updates across PEPs, sanctions, and adverse media, alongside in-depth analysis of business data, offering a granular insight into every aspect of a company. This not only removes the manual effort of searches and checks, but it also improves the execution of enhanced due diligence protocols on high-risk entities.

Our tools go beyond the initial checks too, accounting for the ongoing nature of AML requirements. Once set up, users can tailor their portfolio management to continuously monitor their clients, customers, and suppliers for any changes that may suggest they are no longer suitable to work with.

With Red Flag Alert, businesses can streamline their AML processes, mitigating the risk of human error and ensuring consistent compliance with sanctions regulations. 

We are passionate about reinforcing procedures with our sophisticated platform, granting businesses convenient access to current and precise data, facilitating the swift identification of sanctioned entities and expediting decision-making processes.

Shield your business from regulatory scrutiny, financial penalties, and reputational harm linked to sanctions violations, with a free trial of Red Flag Alert today.