The US Department of theTreasury's Office of Foreign Assets Control (OFAC) has signalled its intention to step up its enforcement of sanctions aimed at Russia on account of its military and political interventions in Ukraine.

OFAC's Crimea Sanctions Advisory (CSA) may cause concern amongst banks writing letter of credit (L/C) business in the Crimean region of Ukraine.

Tough warning

Foreignentitiesconducting business with the region through the US have been warned by OFAC to assesstheir risk appetite in the light of anticipated increased sanctions enforcement. They should ensurethat they have the adequate controls to identify potential sanctions violations according to the CSA.

It warns against the use of schemes OFAC says it has identified to circumvent or evade the embargo againstthe Crimea region of Ukraine.

The advisory also aims to clarify what the Treasury sees as a widelymisunderstood nature of the embargoand expose techniques thatexploit this misunderstanding.

Document screening

The warning notes that Crimea is a geographical region, and most often does not appear by name in L/Cs, payment instructions or trade documents.

The CSA says it is imperative that USentities screen documents to check for locations within the Crimea region, to include cities,towns and ports.

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