3. Red Flag Indicators for Potential Sanctions Circumventions

يسري تنفيذه من تاريخ 4/7/2021

Some Red Flags or Situations to Identify Potential Sanctions Circumventions Published in the Executive Office’s “Typologies on the circumvention of Targeted Sanctions against Terrorism and the Proliferation of Weapons of Mass Destruction” ⁸

The following are some red flags or situations that could be looked at more closely or monitored by financial institutions and designated non-financial businesses or professions to identify potential sanctions circumventions of your clients, their business, or their transactions.

•	Dealings in sectors vulnerable for terrorist financing and/or proliferation of weapons of mass destructions, for example
	o	Financial sector
	o	Hawalas or other money transfer services providers
	o	Oil and gas sector
	o	Non-profit organizations
	o	International trade
•	Dealings, directly or through a client of your client, with high-risk countries for terrorism financing.
•	Dealings, directly or through a client of your client, with sanctioned countries or territories where sanctioned persons are known to operate.
•	The use of shell companies through which funds can be moved locally and internationally by misappropriating the commercial sector in the UAE.
•	Dealings with sanctioned goods or under embargo. For example:
	o	Weapons
	o	Oil or other commodities
	o	Luxury goods (for DPRK sanctions)
•	Dealings with dual-used goods.
•	Dealings with controlled substances.
•	Identifying documents that seemed to be forged or counterfeited.
•	Identifying tampered or modified documents with no apparent explanation, especially those related to international trade.
•	Use of intermediaries.
•	When the flows of funds exceed those of normal business (revenues or turnover).
•	The activity developed or financed does not relate to the original or intended purpose of the company o entity. For example:
•	For companies, they are importing high-end technology devices, but they are registered as a company that commercializes nuts.
•	For a non-profit organization, they are exporting communication devices, but they are an entity aimed to provide health services.
•	Very complex commercial or business deals that seem to be aiming to hide the final destiny of the transaction or the good.
•	Complex legal entities or arrangements that seem to be aiming to hide the beneficial owner.
•	Carrying out of multiple ATM cash withdrawals in short succession (potentially below the daily cash reporting threshold) across various locations in territories where sanctioned people have influence or in the border of sanctioned countries.
•	Irregularities during the CDD process which could include, but is not limited to:
	o	Inaccurate information about the source of funds and/or the relationship with the counterparty.
	o	Refusal to honor requests to provide additional KYC documentation or to provide clarity on the final beneficiary of the funds or goods.
	o	Suspicion of forged identity documents

⁸ Available at https://www.uaeiec.gov.ae/en-us/un-page#