Sanctions Space

‘I believe that it’s become very complex for financial institutions to actually comply. The ask by the Treasury to focus on sanctions evasion is really, in many ways, the bridge back to AML’

-Bill Fox on the global sanctions landscape and what it means for FIs

‘The only sector that really can enforce [sanctions] are the financial institutions sector. We are the police – even though we say all the time in the AML world that we’re not the police – I think we are the police when it comes to sanctions’

-Rick Small on the global sanctions landscape and what it means for FIs

On the latest episode of the Sanctions Space Podcast, Justine sat down with AML legends Rick Small, Executive Vice President, Director Financial Crimes program at Truist and Bill Fox, former Managing Director Financial Crimes at Bank of America. They discuss the intersection and interlinkage between sanctions and AML, assessing sanctions risk in a complex environment, and how the effectiveness of sanctions frameworks could be improved.

‘Looking at KYE (know your ecosystem), you’re able to essentially review the transaction that is not directly with you, and so you can see where the tokens are landing before potentially they’re going towards some sort of illicit flow or to an illicit actor.’

-Jasleen Bains on how to mitigate CTF risks

Recorded at ACAMS Las Vegas Assembly, in this latest episode of the Sanctions Space Podcast, Justine sat down with Jasleen Bains, Compliance Consultant, Ondo Finance and Founder, Bains Labs. They discuss the terrorism-financing landscape and how the illicit financial flows are evading sanctions, the evolution of crypto-related terrorist financing risks, and how regulations could be strengthened to make sanctions relating to crypto more effective.

‘We’re all going to be on this journey, I don’t think we’re going to be in a world where no one’s going to use AI because it’s too hard, we are going to use it, the question is how do we make sure to implement it and execute it so that it’s efficient and credible’.

-Jessica Bartlett

In the latest episode of the Sanctions Space Podcast, Justine is joined by Jessica Bartlett, Managing Director and Head of Global Financial Crime Legal at Barclays. They discuss how the global sanctions landscape has changed over the past decade, how to think about the interlinkage between sanctions and export controls, and how financial institutions need to undertake a mindset shift to strengthen sanctions compliance.

‘As the other core markets for Russia are closing down and tightening the grip, they’re looking for other mechanisms. And we may be seen as an easier mechanism because we haven’t had the benefit of the learnings of the European and the American banks, where they have been really having to grapple with this on a day-to-day basis. We’re now really having to turn our attention to that indirect risk.’

-Kylie Oliver on sanctions risks in Australia

‘We need to think about customers and markets that we may touch into from Australia. It’s a very different risk landscape - much more complex I’d suggest - than it may be in the Northern Hemisphere around this Russian sanctions issue.’

-Gavin Coles on sanctions risks in Australia

In the latest episode of the Sanctions Space Podcast, Justine is joined by Gavin Coles, Global Sanctions Officer at OFX and Kylie Oliver, Senior Manager Enterprise Sanctions Compliance at ANZ. They discuss how industry in Australia is dealing with a complex global sanctions environment, how sanctions exposure can manifest itself in the region, and vulnerabilities to secondary sanctions risks.

‘there must a deterrent effect, that people must be afraid to breach sanctions, especially when it involves common high priority goods or items that generate a lot of revenue to the Russian government to wage war in Ukraine. By proper deterrent effect, I mean real convictions with proper jail times or very hefty fines levied against those who have been intentionally involved in breaching sanctions or have been grossly negligent’

-Paulis Iļjenkovs on strengthening sanctions enforcement in the EU

In the latest episode of the Sanctions Space Podcast, Justine is joined by Toms Platacis and Paulis Iljenkovs, Head and Deputy Head of Financial Intelligence Unit (FIU) Latvia respectively. They discuss the sanctions enforcement landscape in Latvia, including the recent development of the FIU becoming the national competent authority – a ‘one-stop shop’ - for sanctions. They also discuss the exposure to Russia sanctions in the Baltics, the importance of awareness raising among industry, and the potential role AMLA could play in strengthening enforcement.

‘It’s one of the most important developments I think you’ll see coming out of the US in terms of sanctions enforcement, probably for years’

-John Smith on the extension of OFAC’s statute of limitations to 10 years for sanctions violations.

In the latest episode of the Sanctions Space Podcast, Justine is joined by John Smith, co-head of Morrison Foerster’s National Security practice and former Director of OFAC, and Chloe Cina, Partner at Morrison Foerster. They discuss the evolving sanctions enforcement landscape (across both the US and Europe), the extension to 10 years for statute of limitations for sanctions violations in the US and the resulting impact for industry, and the potential sanctions implications of the upcoming US elections.

John E. Smith, former Director of the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC), is co-head of Morrison Foerster’s National Security practice, and a member of the Crisis Management group and Investigations + White Collar group. After serving 11 years as a top official at OFAC and three years as its Director, Mr. Smith brings to the firm unmatched experience in economic sanctions, enforcement, and national security. Read John’s bio here:https://www.mofo.com/people/john-smith.

Chloe Cina is a partner in the London office of Morrison Foerster with unrivalled experience in EU and UK economic sanctions and export control measures. She has nearly two decades of experience in litigating and advising on complex national security issues, both within government and in-house at two leading global financial institutions. Read Chloe’s bio here:https://www.mofo.com/people/chloe-cina.

‘We’ve got new legal powers which we will be using… but also the scale of how we’re operating has, for OFSI at least, changed. Both in terms of the volume of self-disclosures and other intelligence we’re getting from different sources… and secondly how capabilities at OFSI are changing and transforming.'

-Giles Thomson on changes in the UK sanctions enforcement landscape

In the latest episode of the Sanctions Space Podcast, Justine is joined by Giles Thomson, Director of the UK Office for Financial Sanctions Implementation. They discuss sanctions priorities for the UK government, the evolving enforcement landscape, and transatlantic cooperation between OFSI and OFAC

Giles Thomson has been Director of the Office for Financial Sanctions Implementation (OFSI) since November 2020. He is also the senior official in HM Treasury responsible for economic crime policy and is the UK’s Head of Delegation to the Financial Action Task Force. He has been working on sanctions and economic crime within HM Treasury since 2016. Prior to that, Giles held a range of positions across HM Treasury and the Foreign, Commonwealth and Development Office.

'they have a critically important role to play. I think we’re at an inflection point… export controls have never been more important – and the reason why is because of the nature of the national security threat, which has really changed over the last decade or two.'

-Assistant Secretary Axelrod on the importance of the role of financial institutions with respect to export controls.

In the latest episode of the Sanctions Space Podcast, Justine is joined by Matthew Axelrod, Assistant Secretary for Export Enforcement at the Bureau of Industry and Security. They discuss the evolving role of export controls, ramping up engagement across government and industry, as well as both the significant enterprise risk export control violations can pose for organizations and the critical importance that industry meets the moment.

Matthew S. Axelrod currently serves as the Assistant Secretary for Export Enforcement at the U.S. Department of Commerce’s Bureau of Industry and Security, a position to which he was unanimously confirmed by the United States Senate in December 2021. In this capacity, Matt leads a cadre of special agents and analysts dedicated to a singular mission – keeping the most sensitive technologies out of the world’s most dangerous hands.

Read Matthew’s full bio here: https://www.commerce.gov/about/leadership/matthew-s-axelrod

‘The last time this was done - with Iraq - you had two things we’re not going to have here, which is number 1 a [UN] Security Council Resolution, and number 2 the consent of the government of Iraq. We are not getting either in the case of Russia, at least in the near term. And so the credibility of the international mechanism is going to be really important. And so I think it can be done but, look, everything is unprecedented until you do it the first time’.

-David Mortlock on the likelihood of seeing Russian asset recovery

In the latest episode of the Sanctions Space Podcast, Justine is joined by David Mortlock, Co-Chair of Global Trade & Investment Group, Managing Partner for Washington, DC at Willkie Farr & Gallagher. They discuss the changing sanctions enforcement landscape, the state of play regarding seizure and recovery of frozen Russian assets, and how we may see the oil price cap evolve in 2024.

David Mortlock is Chair of Willkie’s Global Trade & Investment Practice Group and Managing Partner of the Washington office. David is formerly the Director for International Economic Affairs at the White House National Security Council, in which capacity he advised the President and his National Security Advisor on sanctions, corruption and other international finance and trade issues. Read David’s full bio here: https://www.willkie.com/professionals/m/mortlock-david

‘You’re not in this classic terror finance space where you are looking at a group like Al Qaeda and people trying covertly to move donations or other forms of money to terrorist groups who have no ability to raise money through conventional means.’

-Edmund Fitton-Brown

In the latest episode of the Sanctions Space Podcast, Justine is joined by Edmund Fitton-Brown, Senior Advisor at the Counter Extremism Project and former UK Ambassador to Yemen. They discuss the ongoing tensions in the Red Sea, the political situation in Yemen and the origin and aspirations of the Houthi group, as well as sanctions actions taken by the US and others against the Houthis.

Edmund Fitton-Brown is Senior Advisor at the Counter Extremism Project and holds advisory or fellowship positions with RUSI, the Middle East Institute, The Soufan Center and New America. Edmund’s former roles have included UK Ambassador to Yemen and being Coordinator of the UN ISIL/Al-Qaida/Taliban Sanctions Monitoring Team.

Read Edmund’s bio here: https://www.rusi.org/people/fitton-brown