What are the key red flags to be aware of when dealing with sanctioned items?

All goods in the Common High Priority List are under trade sanction, meaning handling them is like handling stolen goods. Companies across the supply chain, from logistics to warehouses to shipping, could be breaking the law if they end up involved with these goods that later end up used by Russia, or in fact any sanctioned country.

There are a number of red flags to be aware of when dealing with sanctioned items, and where there is a risk of a sanctions breach. A single red flag is not necessarily indicative of illicit or suspicious activity. The surrounding facts and circumstances should be considered before determining next steps, like submitting a suspicious activity report to the NCA.

Key red flags to look out for

1. Transactions related to payments for goods on the Common High Priority list, from a company incorporated after 24 February 2022 and based in known diversionary destinations.  

2. A customer who lacks or refuses to provide details on banks, shippers, or third parties, including about end users, intended end-use, or company ownership. 

3. Transactions involving smaller value payments, all from the same end user’s foreign bank account, to multiple, similar suppliers of Common High Priority list items.  

4. A customer that significantly overpays for a Common High Priority list item, compared to known market prices. 

5. Purchases under a letter of credit that are consigned to the issuing bank, not to the actual end user. In addition, supporting documents, such as a commercial invoice, do not list the actual end-user. 

6. Transactions involving entities with little to no web presence, such as a website or a domain based email account.  

7. Transactions involving customers with phone numbers with country codes that do not match the destination country. 

8. The item or service (commodity, software, service or technology) does not fit the purchaser’s line of business.  

9. The customer’s name or its address is similar to one of the parties on the OFSI consolidated list. 

10. Transactions involve a purported civil end-user, but research indicates customers with counterparties with connections with the military, such as an address that is a military facility or is co-located with military facilities in a country of concern.  

11. Transactions involving companies that are physically co-located, or have shared ownership, with an entity on the OFSI consolidated list. 

12. Transactions that use open accounts/open lines of credit when the payment services are conducted in conjunction with known diversionary destinations.   

13. Transactions involving a last-minute change in payment routing that was previously scheduled from a country of concern, but now routed through a different country or company.  

14. Transactions involving payments being made from entities located at known transhipment points or involve atypical shipping routes to reach a destination. 

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