European-owned vessels are now exporting nearly 40% of all Russian oil. This not only blunts the impact of sanctions on Russia but introduces new trade patterns that require greater risk management for marine service providers, including insurers and charterers. Windward analysis of June tanker activity shows that 37% of Russian-origin crude and refined products were...
Not all sanctions are equal. There’s no better contemporaneous example than EU-sanctioned, Russia-trading Aframax tanker Torex (IMO 9257814), which sailed through the English Channel on Thursday (July 3), heading to northern European waters to load at Russia’s Baltic ports. The 22-year-old ‘dark fleet’ ship has learned to play the game of maritime regulatory arbitrage with...
Know Your Vessel – Case studies in steering clear of sanctions evasion
What’s inside?
Global trade financing is an increasingly complex task for financial institutions, especially when vessels are involved. Many authorities now expect financial institutions to implement sophisticated controls when it comes to shipping. These include screening and monitoring for potential sanctions violations, trade-based money laundering, and other high-risk transactions.
Recently, the U.S. Office of Foreign Assets Control (OFAC) put out a new advisory describing common deceptive shipping practices. It also recommends a list of due diligence procedures for organizations across the maritime ecosystem to implement.
Given the large volume of transactions and the need for timely processing of transactions, it is not feasible to complete Enhanced Due Diligence (EDD) on every transaction. Financial institutions must rely on a risk-based approach to protect themselves and keep their business on track.
Know Your Vessel: Case Studies in Steering Clear of Sanctions Evasion examines two public examples where standard screening tools failed to identify red flags associated with a vessel involved in a transaction and reviews the resulting risks to the transaction parties.
It goes on to explain how a Know Your Vessel (KYV) process such as considering the vessels’ prior behavior would have flagged the transaction. It ends by describing how KYV can be incorporated into the transaction screening process.
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Risks & Compliance
Greek Shipowners Fill Russia’s Tonnage Void to Blunt Sanctions Impact
European-owned vessels are now exporting nearly 40% of all Russian oil. This not only blunts the impact of sanctions on Russia but introduces new trade patterns that require greater risk management for marine service providers, including insurers and charterers. Windward analysis of June tanker activity shows that 37% of Russian-origin crude and refined products were…
Tankers Newly Reflagged to Vanuatu Show Not All Sanctions Are Equal
Not all sanctions are equal. There’s no better contemporaneous example than EU-sanctioned, Russia-trading Aframax tanker Torex (IMO 9257814), which sailed through the English Channel on Thursday (July 3), heading to northern European waters to load at Russia’s Baltic ports. The 22-year-old ‘dark fleet’ ship has learned to play the game of maritime regulatory arbitrage with…
Red Sea Risk Rises After Two Houthi Attacks in 48 Hours
The Houthis Are Back, and with a Vengeance After a seven-month lull in Houthi attacks on commercial shipping, two vessels were targeted within 48 hours using drones and rocket-propelled grenades launched from multiple small craft. Both vessels were Greek-owned, and each belonged to fleets with other ships that had called at Israeli ports within the…
Russia Defies Sanctions as Shadow Fleet Resumes Arctic LNG 2 Exports
Arctic LNG 2 Resumes Operations All eyes are on US-sanctioned Iris (IMO 9953523) and Russia’s Arctic LNG 2 terminal after the liquefied natural gas carrier loaded the first cargo from the plant in nearly nine months. The loading marks both a restart of operations at the flagship gas project and a renewed Russian commitment to…
Benin: Newest False Flag Used by Iran’s Shadow Fleet
Two VLCCs Flagged Under Fraudulent Benin Registry Benin has become the newest country exploited by Iran’s dark fleet, with two very large crude carriers (VLCCs) falsely claiming its flag. Azelia (IMO 9365776), a 2009-built VLCC, is currently broadcasting Benin’s flag — one designated as false by the International Maritime Organisation (IMO). Another VLCC, Flora (IMO…
