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1. Sanctions And You
An Affordable Solution to the
Compliance Requirements
Lee Werrell FInstSMM Chartered MCSI Cert PFS

2. Sanctions & You
By CEI Compliance Limited www.ceicompliance.co.uk
Sanctions
The Legislation
The Money Laundering Regulations 2007 became law on 15 th December 2007
and explains the measures that a company must employ to detect and prevent
money laundering. The Proceeds of Crime Act 2002 (including the Asset
Recovery Agency) provided specific money laundering offences and
investigative powers, including the seizure of assets.
Sanctions are made against countries, companies and individuals where the UK
government considers that allowing them financial freedom would harm or
endanger others and are typically used by the international community as a
whole.
In the UK (and in UK jurisdictions) The Foreign & Commonwealth Office is responsible
for the overall policy on international sanctions and HM Treasury is responsible for the
implementation and administration. Absolute compliance is demanded. Failure
to comply can result in prison terms of between 2 and 7 years depending on
the seriousness of any breach.
In the financial services world we all know that it is a crime to advise or transact
any business with a listed individual and the 7 year imprisonment term, and / or a
fine, can be imposed if it is established that this has happened.
1“Money Laundering regulations place a general obligation on firms within its
scope to establish adequate and appropriate policies and procedures to prevent
money laundering. Failure to comply with this obligation risks a prison term of up
to two years and / or a fine.”
This means that firms must ensure they have reasonable processes and
1
Source = August 2009 Joint Money Laundering Steering Group’s consultation
document on prevention of money laundering / combating terrorist financing
CEI Compliance limited www.ceicompliance.co.uk

3. Sanctions & You
By CEI Compliance Limited www.ceicompliance.co.uk
procedures in place to prevent the movement of money, from or for, crime and
terrorism through their firm and even failure to have adequate systems, is
potentially sufficient to bring about a prosecution and potentially result in a 2
year term of imprisonment.
IMPORTANT - While the legislation clearly states that it is unacceptable for firms to
deal with anyone who is present on the Sanctions list, exactly how they should
comply with the requirement is not specified – hence in the development of
SanctionsSearch.com, guidance has been taken from both the Joint Money
Laundering Steering Group (JMLSG) and the Financial Services Authority (FSA).
Both of these organisations state that companies need a system or procedures
in place through which they can actually demonstrate that their clients are not
listed – not only at introduction - but also ONGOING.
The regularly updated Sanctions list is freely available as a CSV document from
HMT's website (www.hm-treasury.gov.uk) and manual checking against this list is
indeed possible. However, since real proof of compliance requires the ability to
show an audit trail that proves clients are absent from the lists on an on-going
basis, manual checks are proving to be at best cumbersome with – and at
worse unreliable.
There are many solutions from an expanding number of companies and all are
charging a variety of fees for the service of sanctions list checking, including the
“fuzzy” matches of misspelt and sound-a-like names used by criminals and
terrorists, but I believe that we have found a true gem. One of the on the market is
£199 annual membership which included 10 search credits and additional credits
could be purchased for £1.00 each minimum of 50 credit bundles. This would
mean that for a company dealing with 300 new clients per annum, ignoring any
initial screen would cost in the region of £500 initial, and then the same amount
every time there was an HMT update.
Looking further into this area we found this excellent value service at a cost akin
to visiting your favourite coffee shack. Starting at only £20 for the first 100 clients
CEI Compliance limited www.ceicompliance.co.uk

4. Sanctions & You
By CEI Compliance Limited www.ceicompliance.co.uk
on an initial and on-going basis, with only £10 for each 100 clients after this, it is a
steal.
CEI Compliance recommends that you consider the valuable offer from
Sanctions Search. You can contact them at
Sanctions Search
Professional Office
45 Market Street
Hoylake
Wirral
CH47 2BQ
Telephone 0845 652 67 67
Fax 0151 632 2117
And their website is http://www.SanctionsSearch.com
Details correct at time of printing (Oct 2010)
For help call:
Lee Werrell – FInstSMM Chartered MCSI Cert PFS
Managing Director
CEI Compliance Limited
lw@cei-compliance-limited.co.uk
Web: www.cei-compliance-limted.co.uk
www.skilledpersonsreports.co.uk
www.complianceconsultant.org
www.ceicompliance.co.uk
www.s166.co.uk
CEI Compliance limited www.ceicompliance.co.uk