Regulatory intelligence for US exporters

Law Firm Explores Sanctions Compliance Lessons From 2022

Based on 2022 U.S. sanctions enforcement trends, companies should make sure to scale their sanctions compliance programs along with their business expansions, continually conduct audits and make sure employees are properly trained on sanctions compliance, Morrison & Foerster said in a March 6 client alert. The alert explores some of the lessons companies can learn from the Treasury Department’s penalties last year, including that “insufficient oversight” during a merger process can lead to sanctions risks, and all companies -- large or small -- will be held to Treasury’s sanctions compliance standards.

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The firm also stressed the importance of using geolocation tools as part of a sanctions compliance program. Morrison pointed to the Office of Foreign Assets Control’s $116,000 settlement in September with Tango Card, which didn’t use location tools to adequately screen customers. The settlement highlighted that companies that fail to use IP addresses and other location data to screen its customers “throughout the course of the counterparty relationship” risk violating sanctions, the firm said. OFAC has stressed that the “use of geolocation tools, including IP blocking,” is a “core element of an effective, risk-based sanctions compliance program,” the firm said.