Financial Crime World

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Financial Sanctions and Freezing Measures

Key Terms

When dealing with financial sanctions and freezing measures, it’s essential to understand the following key terms:

  • Potential match: A potential match occurs when there is any match between data in Sanctions Lists with information in your databases.
  • Confirmed match: A confirmed match happens when a potential match has been verified as the individual, group, or entity subject to financial sanctions (TFS).
  • False positive result: This occurs when a potential match was discharged.

Freezing Measures

Freezing measures are implemented to prevent listed individuals, groups, or entities from accessing their assets. The following scenarios trigger freezing measures:

  • Any percentage of ownership must trigger freezing measures in relation to assets owned by listed individuals, groups, or entities.
  • Freezing measures must be implemented if there is any information or indication that funds are controlled (directly or indirectly) by listed individuals, groups, or entities.
  • If a listed party owns or controls funds or other financial assets or economic resources in which unlisted individuals or entities also have a segregable interest, freezing measures should only apply to the share of the asset owned or controlled by the listed party.

Implementation

When implementing freezing measures, you must:

  • Freeze assets without delay when there is any indication or suspicion that a potential match may be a confirmed match.
  • Notify the relevant Supervisory Authority and Executive Office within 2 business days from taking any freezing measure.

When determining ownership and control for legal entities, consider the following:

  • In cases where an asset is owned by a listed party and an unlisted party, if the interest cannot be segregated, the entire asset should be subject to freezing.
  • When assessing ownership, consider whether an individual or entity has more than 50% of proprietary rights or majority interest in an entity.