Firms should assess potential sanctions risk exposure not only across the entire organization but also in dealings with business partners such as vendors and suppliers. Given the ever-changing nature of OFAC, UN, EU and other countries’ sanctions and freeze lists, a company’s sanctions risk profile may also change. Firms should revise policies and procedures based on those regions in which it conducts business. Risk assessment can include inherent, perceived and residual risks associated with given business activities and/or relationships in sanctioned jurisdictions or with potentially sanctions entities. For example, how should a firm adjust its operations in light of sanctions against Russia or easing of sanctions against Cuba? Some governments mandate that adequate risk assessments form the core of any sanctions compliance program and that such assessments be tailored to the company’s operations and third-party relationships.

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