Imagine: a small company ships a batch of equipment to Turkey. Everything is clean — the counterparty is not on the SDN List, the country is not under embargo. But a month later, the account is frozen, and the bank is asking questions. Why? Because the ultimate recipient is a subsidiary of a structure that is 51% owned by a person on the EU sanctions list. Not a word about this was in the documents, but it is exactly such stories that are becoming the norm for those working with foreign markets.
Myth one: "it is enough to check the counterparty against the list." In reality, sanctions compliance is not a one-time check but a continuous process. OFAC (the US Office of Foreign Assets Control) requires not only screening against the SDN List but also analysis of the ownership structure. The 50 Percent Rule (OFAC 50 Percent Rule) states: if a sanctioned person owns, directly or indirectly, 50% or more of a company, that company is also considered blocked — even if it is not on the list. Many forget this.
Myth two: "sanctions are only about the US." No. UN Security Council resolutions are binding on all member states. The EU maintains its own consolidated list. FATF (the Financial Action Task Force) sets AML/CFT standards that banks apply worldwide. If you work with a European bank, it will request confirmation not only under OFAC but also under EU lists. And if you fall under US secondary sanctions, you risk losing access to dollar settlements even without having a US legal entity.
A Complete Course on International Sanctions: Where Expectations Really Break Down
Let's take a typical task: check a new supplier from the UAE. Where to start? Many immediately open the SDN List and search for the name. But that is only the tip. A practitioner acts differently.
First, they check the jurisdiction and industry: does the activity fall under sectoral sanctions (for example, the Russian financial sector or Iranian oil). Then they look at the ownership structure — through public registries and document requests. In parallel, they cross-check the director's name and beneficiaries against the EU, UN consolidated lists and national lists (including Russian counter-sanctions). And only after that — against the SDN. It takes from several hours to several days, depending on depth.
If you skip the beneficiary check stage, you can run into a payment block. The correspondent bank will see that the ultimate recipient is linked to a sanctioned person and will freeze the transfer. The investigation will take weeks, and reputational damage — months. More on the topic: “Banking Regulation — Basel III/IV & Prudential Supervision: How to Build and Stress-Test LCR and NSFR Yourself Before the Supervisor Does”.
UN, EU, and OFAC Sanctions: Three Different Logics to Keep in Mind
UN Security Council resolutions are binding on all states. They are adopted against countries or specific groups and impose arms embargoes, asset freezes, and travel bans. There are few of them, but they are strict.
EU sanctions are adopted at the level of the Council of the EU and published in the Official Journal. They can be both country-specific and thematic (for example, for cyberattacks or human rights violations). The EU updates its lists more often than the UN and includes both individuals and legal entities. More on the topic: “IT Legal & Compliance: What Developers Get Wrong About GDPR, Licenses and IP — and How to Choose Your Path”.
OFAC maintains the SDN List and sectoral lists (SSI). SDN means a full asset freeze and a ban on any transactions with US persons. SSI means restrictions on certain types of activity (for example, financing projects in specific industries). Important: US persons are prohibited from facilitating transactions with SDN, even if the transaction itself takes place outside the US.
FATF does not impose sanctions but sets standards for combating money laundering and terrorist financing. Banks use these recommendations to build KYC procedures. If your company does not meet FATF expectations, the bank may refuse service without explanation. More on the topic: “Banking and Financial Regulation: How Licensing, Credit and AML Rules Actually Decide Whether Your Product Launches”.
How to Distinguish Real Compliance from Formal
Formal approach: downloaded the list, ran a search, saved a screenshot. Real: set up regular monitoring (once a month or more often), check not only the counterparty but also the supply chain, track changes in legislation. For example, in 2024 OFAC tightened rules for the Russian IT sector, and many companies that did not update their policies continued to ship equipment, considering it "not covered." The result — fines and criminal cases in the US.
Another nuance: name screening produces false positives. If the counterparty has a common name, the system may block the payment. A good compliance specialist knows how to resolve such matches by date of birth, passport data, and address. Without this, business stalls. More on the topic: “GDPR (EU Data Protection): What Data Processing Principles Actually Demand — A Hands-On Breakdown”.
The Myth That Sanctions Only Affect Large Companies
Small and medium-sized businesses face sanctions risks no less often. For example, a startup purchases components from China, and they contain American technologies. If the final product ends up in Russia, US export controls (EAR) may apply. Even a small batch of microchips can lead to criminal liability in the US if export regulations are violated.
Moreover, banks are increasingly requesting sanctions assurances from clients. If a company cannot confirm that its counterparties are not under sanctions, the account may be closed. This is not a theoretical risk — many Russian companies faced this after 2022.
Learning Paths: Self-Study, Courses, Practice
You can study sanctions law on your own using official documents: the websites of OFAC, the EU, the UN, FATF. The plus — it's free and accurate. The minus — there's no structure, it's easy to miss interconnections, and mistakes in real work are costly.
Practice under the guidance of an experienced colleague is the best option, but not everyone has that opportunity. Courses provide a system and feedback. For example, International Sanctions and Compliance (OFAC, UN, EU, FATF) is built around real cases: counterparty checks, ownership structure assessment, analysis of export restrictions. Lessons are personalized to the student's level, and error analysis can be obtained in a chat with AI. More on the topic: “International Tax Planning (OECD, IRS, EU): An In-Depth Course That Shows How the Rules Actually Bite”.
The choice depends on your situation. If you are just entering the field, a course will save you months of trial and error. If you are already working but want to fill gaps — perhaps targeted consultations are enough.
Who This Is Not For
Those looking for a magic pill. Sanctions legislation changes every week, and no course will provide ready answers to all cases. You will have to learn to think like an analyst: compare facts, verify sources, assess risks. If you are not ready for routine and monotonous document checks, compliance will quickly become boring.
Also, you should not enter the field if you expect quick results without effort. The first months will go into studying regulations and practicing on cases. But afterwards, you will be able to prevent payment blocks and fines, which in the sanctions sphere are measured in millions of dollars.
In conclusion, I want to emphasize: sanctions compliance is not bureaucracy but a tool for protecting business. By studying it systematically, you stop fearing audits and start managing risks. The course International Sanctions and Compliance (OFAC, UN, EU, FATF) provides exactly such a system — with an emphasis on practice and analysis of real situations.