Financial Services Executives Recognize Weaknesses in Sanctions Compliance EffortsDeloitte Survey |
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Multinational organizations are beginning to feel the business need and regulatory imperative to coordinate economic and trade sanctions compliance activities across borders. Forty-six percent of respondents consider sanctions compliance to be a growing concern, and 63 percent say it is consuming more time, money and personnel than ever, according to a Deloitte survey of 388 executives and managers from around the world.
Increasing global regulatory rigor has made the task more pressing. Yet, at nearly one in four companies, compliance staff receives training, at best, only once every two years. In fact, some of the biggest challenges respondents’ companies face in implementing sanctions-related controls are the complexity of screening all of the dimensions of financial transactions (56 percent) and meeting growing regulator expectations (41 percent).
According to the study, titled Facing the Sanctions Challenge in Financial Services, only 50 percent of companies have operationalized what sanctions policies they do have, creating the real possibility that the absence of a robust sanctions compliance program — or an inadequate one — could result in regulatory discipline by the U.S. Office of Foreign Assets Control (OFAC), as well as federal and state regulators and prosecutors.
“As OFAC continues to be more rigorous in its oversight of financial institutions and international regulators, while simultaneously increasing their own vigilance, more organizations are responding to regulatory actions than they had in the past 10 years,” said Michael Zeldin, global leader, Anti-Money Laundering/Trade Sanctions Services for Deloitte Financial Advisory Services. “At the same time, financial institutions have to contend with shrinking compliance budgets and headcounts. This is a combination fraught with danger.”
Access the full survey report below.
About the Survey
Deloitte contracted the Economist Intelligence Unit to conduct a survey of executives and managers around the world regarding anti–money laundering sanctions. The 388 survey respondents were drawn from the Economist Intelligence Unit's global executive survey panel. The survey was conducted online from August 20 to October 3, 2008.
Among the executives participating in the survey, 40 percent were board members, chief executive officers, and other C-level executives. Fifty percent of respondents’ organizations had annual revenues greater than US$5 billion.
Respondents were geographically located in Asia-Pacific (32 percent), North America (24 percent), Western Europe (28 percent), Middle East and Africa (7 percent), Latin America (5 percent), and Eastern Europe (4 percent).
As used in this document, ‘Deloitte’ means Deloitte LLP (and its subsidiaries). Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries.
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Global Sanctions Survey Report
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