TECHNOLOGY AND DATA ANALYSIS FOR GLOBAL SANCTIONS COMPLIANCE
R&C: How would you summarise the prevailing trends to have emerged in global sanctions over the past 12 months or so? To what extent is it becoming harder for companies to remain compliant?
Aguilar: The radical shifts in sanctions policy pursued by the US government, in particular the threat of secondary sanctions related to Iran, pose a material risk for the international insurance sector. European blocking efforts worsen this already difficult situation. Even before these developments, however, regulators had already intensified their focus on insurance as its key role in enabling global trade became increasingly evident. In this context, mitigating sanctions risks in insurance has become more complex. For example, the risk of having gaps in reinsurance cover increases as reinsurers are subject to different sanctions regimes or have different sanctions risk appetites. Likewise, insurers active in the marine or aviation sectors or that cover risks in multiple jurisdictions must implement dynamic controls to enable underwriters, claims and back-office employees globally to timely identify and escalate sanctions risks for further analysis. Designing and managing such controls is not an easy task in a sector where complex global processes and legacy IT systems are common.
Jul-Sep 2018 Issue
Aguilar Pariente Advisory
Gibson, Dunn & Crutcher LLP