Why a shared approach to sanctions is best

Of all the fines levied against financial institutions in recent years, those imposed on HSBC and BNP Paribas for breaches of sanctions and related financial crime breaches, totalling over $US10 billion, are perhaps the most notable.

" There's increasing recognition no single part of civil society can solve the global problems we face whether it's corruption, money laundering or the financing of terrorist activity."
Mark Evans, Chief Compliance Officer ANZ

But is it really 'us against them' when it comes to sanctions or do financial institutions and regulators have a shared objective in this increasingly important area?

Of course, such massive fines are indicative of zero tolerance among regulators for breaches of sanctions. Rightly, there is a line in the sand which says deceptive practices will not be tolerated. 

We all have an interest in global financial security and international sanctions support and, as evidenced by recent events regarding Mossack Fonseca, discussions about how we achieve this are more important than ever.  


Regulators are increasingly recognising a shared approach to reaching this goal is the best way forward. 

ANZ recently hosted Jamie Rose from the Office of Foreign Assets Control (OFAC) of the US Department of the Treasury as part of their outreach activity intended to help institutions understand their sanctions obligations.

This type of partnership approach is important. There's a shared need for regulators and banks to share information, so financial institutions are clear on what is expected of us and can ensure we work to optimise the flow of transactions and maximise levels of compliance.

At ANZ, to achieve this across the 34 countries in which we operate, we aim to implement a high waterline – a standard above the minimum level in all the countries in which we operate.

While this may mean meeting rules we don't need to – for example meeting sanctions requirements in relation to Cuba, which only apply to the US – this approach makes it simple for our people to understand and meet our obligations.

The alternative would mean attempting to implement the sanctions requirements of every country and then monitoring transaction by transaction, customer by customer, to ensure we comply with any laws which might apply to that transaction and the nationalities of the people involved.

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This would require enormous resources, be liable to error and impact the smooth flow of transactions, which isn't in anyone's interest.

But while our approach might be simple, it requires constant vigilance. We have prioritised investment in monitoring systems, upskilling our people and investing in customer due diligence so we can understand the risks to which we're potentially exposed.

Although we're taking a proactive approach to keep at the forefront of developments, no organisation can work alone. And nor should they.

There isn't a competitive differentiator when it comes to sanctions compliance. It's a shared interest best achieved by working together with our correspondent banks and with regulators.


This is where the idea of working in partnership is so important. There's increasing recognition no single part of civil society can solve the global problems we face whether it's corruption, money laundering or the financing of terrorist activity.

Banking is a global business, and sharing information and building good relationships with enforcements agencies such as AUSTRAC and OFAC and our peers is vital.

That's why we're doing things such as hosting OFAC and partnering with NGOs such Transparency International, with whom we've just undertaken a cornerstone membership with the Australian chapter.

By working with other like-minded organisations we can join forces to ensure an efficient and effective approach to tackling financial crime.

Mark Evans is Chief Compliance Officer, Guy Boyd is Head of Financial Crime and Dinesh Anand is Head of Sanctions Compliance at ANZ.


The views and opinions expressed in this communication are those of the author and may not necessarily state or reflect those of ANZ.

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