ACAMS Today Magazine (September-November 2017) Vol. 16 No. 4 | Page 68

AML POLICY Carrots and sticks… and sanctions F rom behind a bank of computer monitors, performing day-to-day compliance operations, it is easy to see economic sanctions as a binary thing: sanctions targets are persona non grata , and everyone else is not. However, from a policy level, sanctions are a much more multifaceted tool of statecraft that provides great flexibility in both exerting pressure and minimizing the impact on one’s own economy. 68 ACAMS TODAY | SE PTEMBER–NOVEMBER 2017 | ACAMS.ORG | ACAMSTODAY.ORG Who is sanctioned? The first area where regulators can show flexibil- ity is in the designation process. Designations are generally very specific, although the Office of For- eign Assets Control (OFAC) 50 Percent Rule (and its equivalents elsewhere in the world) signifi- cantly expands the reach to parties related to those designated. On the other hand, the wording of regulation or government order (e.g., Executive Orders in the U.S.) make whole classes of people subject to sanctions as long as there is knowledge that a person or entity meets the definition of those subject to sanctions. Those documents typ- ically cover specific ranges of actions taken in the past (e.g., participation in the assassination of Lebanese officials) or on an ongoing basis (e.g.,