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Learn about the UN Sanctions List and why businesses need to consult it.
Sanctions are punitive measures taken by governments to deter financial crime and protect lawful citizens. They target individuals, businesses, and countries that pose a potential threat due to their involvement in criminal or terrorist activities.
The United Nations (UN) maintains a sanctions list (otherwise known as the United Nations Security Council Consolidated list or UNSC Consolidated List) which many businesses are legally obliged to check to avoid doing business with criminals, drug traffickers and money launderers. For example, under US implementing regulations (such as the President’s Executive Orders) and the Bank Secrecy Act, financial institutions are obliged to screen their clients against relevant sanctions lists, including the UNSC Consolidated list.
Onboarding a sanctioned client threatens the safety and compliance of a business. The consequences vary from security breaches, stolen funds, regulatory fines and even criminal penalties.
Read Sumsub’s article to learn more about UN sanctions and why businesses need to address them.
The UN sanctions list is maintained by UN member states and organizations to eliminate terrorism, weapons proliferation, human rights violations, money laundering, deliberate destabilization of sovereign countries, and drug trafficking, etc. Depending on the situation, sanctions are applied to economic, cultural, trading, or diplomatic relationships with targeted countries.
The United Nations Security Council (UNSC) has primary responsibility for the maintenance of international peace and security. It has 15 members (5 permanent members with veto powers—China, Russia, the US, France, and the UK—and 10 non-permanent members), and each member has one vote. Under the Charter of the United Nations, all member states are obligated to comply with Security Council decisions, including sanctions imposed by the body.
Security Council sanctions have taken on a number of different forms and goals. Currently there are four main types:
Termination of cooperation, breaking all diplomatic bounds such as country’s embassies, councils, and joint cultural events.
Trade bans and barriers, such as increased fees in certain economic sectors like food, weapons, pharmaceuticals, etc.;
Various restrictions on travel to a comprehensive ban for all nationals of a country, a ban on transit through territories of a country, a ban on travel to rebel-held territory within a country, to an aviation ban on all flights into or out of a country, etc.
Sport sanctions prevent a country’s athletes from competing in international events.
Together, the above measure aim to:
See the rest of the organizations under UN sanctions on the UNSC website under the “Entities and other groups” tab.
The Consolidated United Nations Security Council Sanctions List is available on this website.
When a business onboards a sanctioned client, whether knowingly or unknowingly, it threatens safety and compliance. The consequences vary from security breaches, stolen funds, and regulatory fines to civil and criminal penalties.
Is there a solution? Yes—to be aware of all sanctions and process customers based on the UN restrictions they or their country face.
Manual checks are no longer helpful and scalable enough for onboarding high volumes of customers. Besides that, personal data can’t be processed as accurately as can be done with automation. Screening software has proven to be more efficient and precise when it comes to searching for data across watch lists. Accordingly, an automated KYC/AML solution can help you monitor individuals on global sanctions lists, including OFAC, UN, HMT, EU, and DFATdr.
The UN Sanctions List is a UN-issued list of countries and individuals that face economic, trade, or diplomatic limitations due to their criminal or peace-violating activity.
There are diplomatic (e.g. end of cooperation), economic (e.g. trade ban, tariffs), travel (e.g. travel ban, aviation ban), and sport (e.g. disqualification) sanctions.
Sanctions against states and organizations can be imposed by the UN Security Council, the European Union (EU) and individual states on the national level.
Learn more about UN sanctions on the United Nations’ Official Website. Otherwise, read The Sumsuber for more insights on UN sanctions.