Everything you need to know about guidance from ACCA and other organisations
ACCA has published guidance outlining our expectations and the requirements of members in respect of the tranche of sanctions placed by the UK on Russia and Belarus.
The CCAB has also published guidance in respect of members’ anti-money laundering (AML) obligations and ethical considerations that may be faced.
The situation is constantly evolving and firms should keep up to date and be aware of changes and how they affect them.
Below are some frequently asked questions to support you in understanding what is required.
Where can I access the UK sanctions list?
The easiest way to search the individuals and entities sanctioned is via The Office of Financial Sanctions Implementation (OFSI) list.
If your firm relies on a third-party electronic verification service for sanctions screening of your clients, you should be aware that there may be a delay between individuals and entities being sanctioned and the provider updating their list.
You should make sure you are fully aware of how the sanctions screening process works for any third-party service – for example, do you need to re-run your client list manually in the software or is there an automated check conducted as lists are update?
Where can I get general guidance on sanctions?
The Office of Financial Sanctions Implementation (OFSI) provides general guidance on financial sanctions.
What steps should I take to make sure I am not trading with someone on the sanctions list?
Review your client list and consider any entities or individuals that may have links to Russia or Belarus.
Remember that often Russian oligarchs will use offshore companies to mask their ownership of assets so ensure you have identified the ultimate beneficial owner (UBO) of all clients. Oligarchs may also hold citizenship other than Russian, such as in Cyprus or Malta.
Re-conduct the client due diligence (CDD) of those you think may have links to Russian individuals, companies or other entities. Consider whether you need to conduct enhanced due diligence (EDD).
ACCA has created a factsheet to help firms understand CDD requirements. You should also consider your supply network to ensure that you have no suppliers that may be linked to entities or individuals with sanctions against them.
What do I need to do with clients who are subject to sanctions?
Continuing a business relationship with a client subject to sanctions is a criminal offence.
If you discover a client is subject to sanctions, a report must be made to OFSI as soon as practicable and you will need to:
Reports of frozen funds and economic resources, information regarding a designated person, and notifications of credits to frozen accounts should be emailed to: ofsi@hmtreasury.gov.uk.
Reports regarding suspected breaches should be submitted to OFSI using this form.
Can I still do business with people? What do I do if I get a match?
Where a transaction involves a person or organisation who is subject to financial sanctions (whether directly or indirectly), you must obtain a licence to allow the activity to take place without breaching financial sanctions. OFSI can only issue licences on specific legal grounds. Read OFSI's guidance.
What other considerations should I have in respect of sanctions?
Review your firm-wide risk assessment (FWRA) to ensure it reflects accurately any risks faced by the sanctions. ACCA has created a factsheet to help firms understand how to conduct an effective FWRA.
Review your AML policy and procedures (AML P&Ps) to ensure they accurately reflect your screening process. ACCA has created a factsheet to help firms understand what is required in their AML P&Ps.
If the entity has no current sanctions in place, also consider your ethical obligations to act with integrity, objectivity, with professional competence and due care, confidentiality and with professional behaviour. Are you comfortable with this client, are there potential reputational risks? Do they have links to sanctioned individuals/companies that you may not be aware of?
Consider and review your firm’s IT security. The National Cyber Security Centre (NCSC) is urging all UK businesses to bolster their cyber security to protect against malicious cyber attacks. Read NCSC's guidance.
Suspicious activity reporting (SARs)
In March 2022 the UK Financial Intelligence Unit (UKFIU) introduced a new SARs glossary code for entities associated to sanctioned individuals and companies on the sanctions list.
In the ‘reason for suspicion’ free text box of the SAR use the code XXSNEXX where you suspect the activity is consistent with money laundering and is linked to entities sanctioned by the UK, US, EU and other overseas jurisdictions as a result of the Russian invasion of Ukraine.
ACCA has created a factsheet to help firms submit a good-quality SAR.