Targeted Financial Sanctions
The Financial Reporting Authority (“FRA”) issued ‘Financial Sanctions Guidance’ in February 2020 (please click on the link above to access). The purpose of the guidance is to assist relevant institutions, businesses, and professions in complying with their obligations under financial sanctions including the approach to licensing and compliance issues.
Financial sanctions are restrictions put in place by the UN, EU, or UK to achieve a specific foreign policy or national security objective. A number of international financial sanctions are applied against countries, regimes or persons designated to be in violation of international laws. They are imposed with the intent of:
• changing the conduct of listed countries, regimes or persons;
• imposing punitive measures when international peace and security are threatened, and diplomatic efforts have failed;
• signaling disapproval and demonstrating international unity for e.g., a territory-controlling terrorist group that does not require access to the international financial system;
• protect the value of assets that have been misappropriated from a country until these assets can be returned; and/or
• deterring, preventing, or suppressing terrorist acts or nuclear proliferation.
Pursuant to Regulation 5 of the AMLRs, firms of attorneys-at-law conducting relevant financial business are required to implement procedures to ensure compliance with financial sanctions obligations applicable in the Cayman Islands.
In October 2019, The FRA launched a sanction alerts automatic email notification system. We strongly advise all law firms to ensure relevant staff are subscribed to this alert system.
The FRA’s list of sanctions targets by regime in force in the Cayman Islands (as at 21 April 2023) is available here.
Russia Sanctions Regime
With the UK government imposing sanctions on Russia, firms must ensure they are up to date with their sanctions obligations.
The Russia sanctions regime is aimed at encouraging Russia to cease actions destabilising Ukraine, or undermining or threatening the territorial integrity, sovereignty, or independence of Ukraine.
Persons designated under this regime are included on the UK Sanctions List.
The FRA’s Public Announcement dated 1 March 2022 is available here.