The maritime industry faces some tough anti-financial crime compliance challenges, including the need to keep up-to-date with potentially thousands of agents around the world, having multiple voyage-associated parties across various jurisdictions and facing the opaque ownership of ships and assets.
Additionally, anti-financial crime regulations can vary significantly across countries and can change almost daily. The current fluid compliance environment is expected to last, so inaction isn’t an option for Operations Directors who want to sleep well at night. We will set out here some generally accepted guidelines which can assist with managing compliance:
Follow the funds
The US Government issued a 35-page Guidance in May 2020 that provides specific guidelines on due diligence and other compliance-related activities.
It lays out a non-exhaustive list of best practices companies can adopt to prevent sanctions violations, providing clear guidance to insurers, ship owners, operators, brokers, crewing companies, and ship captains. It recommends that companies appropriately assess their sanctions risk, implement compliance controls to address any gaps in their compliance programs, and adopt best practices (view the full list of best practices in this report).
The International Group of P&I Clubs notes that the guidance places heavy emphasis on the need to perform proper know your customer (KYC) and know your customer’s customer (KYCC) procedures. The way in which many commodities are traded renders this a complex area, and the consequences of not complying with US primary and secondary sanctions legislation can be severe.
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