3.1. Sanctions Evasion

Effective from 4/7/2021

Illicit actors targeted by sanctions are likely to utilize a range of tactics to evade the prohibitions, which can be difficult to identify. LFIs should remain vigilant in order to identify attempts to evade, avoid, or circumvent sanctioned activities. Frequent tactics employed for sanctions evasion include renaming, using intermediaries, creating front companies, and using alternative financial networks. LFIs should monitor not only for sanctions violations but also for red flags of potential evasion risks. LFIs also a need to remain vigilant for new methods of evading sanctions. Customer Due Diligence (“CDD”) and Enhanced Due Diligence (“EDD”) play a critical role, in combination with sanctions screening, to identify and prevent more complicated forms of sanctions evasion.

LFIs should also prohibit activity that aims to evade or circumvent sanctions prohibitions. Accordingly, LFIs must not engage in activities that could be part of a sanctions evasion scheme, including but not limited to:

	•	Tipping off customers or counterparties;
	•	Omitting, withholding, altering, misstating, or removing any information about customers or transactions;
	•	Accepting incomplete (when the customer deliberately does not provide an identifier to obscure being matched with the sanctions lists, such as a date of birth or address) or false information (when the customer provides a false identifier that would not match with the sanctions lists listed details, such as a wrong date of birth);
	•	Providing false or incomplete information to counterparties or sanctions-imposing authorities; or
	•	Any other activities that would cause a conflict with or failure to comply with this Guidance.

For more details and information, please refer to the Executive Office’s “Typologies on the circumvention of Targeted Sanctions against Terrorism and the Proliferation of Weapons of Mass Destruction” (circulated by CBUAE Notice No. 2893 dated 02/06/2021).