Sanctions and compliance issues in Iran, North Korea, Burma / Myanmar – highlights from an ACAMS discussion


Speakers & Panellists from US Department of the Treasury, Office of Foreign Assets Control (OFAC), US Department of State, Association of Certified Anti-Money Laundering Specialists (ACAMS) & Banks converged on March 7th, Monday at Peninsula Hotel in Singapore for a dialogue on sanctions and compliance issues related to Iran, North Korea, Burma/Myanmar and other countries along with the Joint Comprehensive Plan of Action (JCPOA). The event was exclusively sponsored by Accuity.

A few key takeaways from the event included:

  1. A number of secondary OFAC sanctions have been lifted so for Non-US persons/companies this provides some flexibility to legally engage with Iran. However primary sanctions remain and extend to US entities. The issue of targeted sanctions extends to Executive Order 13599 in which Iranian government entities or state owned entities are still not permissible by US persons/companies to engage with. Foreign entities do not have such restrictions unless aggregate ownership is involved, especially across programs (eg Specially Designated Nationals (SDN) and EO 13599).
  2. With the new UN Security Council sanctions rolling on DPRK (North Korea), all member states are to comply and enforce these sanctions. The reach of these sanctions goes further than any from the UN in the past.
  3. Singapore is a large financial centre for Myanmar/ Burma and there are exemptions/licenses that allow US businesses to engage with select Burmese persons/companies. The challenge is that the designated SDNs still on the OFAC list with previous severe violations of human rights own a large portion of key sectors thus making legitimate business engagement a deep dive exercise in enhanced ultimate beneficial ownership (UBO) due diligence. The impending regime change to be led by Aung San Suu Kyi effective 1 April 2016 will have interesting implications for this sanctions program.
  4. An important takeaway was around “Sanctions Maintenance”, which means that if sanctions remain static then those who are sanctioned gradually erode their sanctions by divesting ownership or finding other channels to bypass them. The bare minimum, then, to identifying violations is to ensure list data is up to date but ultimately, hidden linkages and true ownership can only be uncovered through enriching KYC data research using all data points to highlight risks.
  5. On the controlled (Part1) and dual use goods (Part2) lists given out by the Nuclear Suppliers Group (NSG), there was a clear statement, that shipments both to and from the sanctioned countries is prohibited.

For more information, on the program please visit – http://www.acams.org/acams-chapters/singapore/#events

For more information on the sanction guidelines, please visit – https://www.treasury.gov/about/organizational-structure/offices/Pages/Office-of-Foreign-Assets-Control.aspx

Read Accuity’s latest blog on Iranian sanctions lifting – https://accuity.com/accuity-insights-blog/iran-sanctions-challenges-and-opportunities/