Moody’s has released new research mapping the global landscape of sanctions regimes, offering insights into how governments and organisations deploy these measures and how financial institutions can respond to the growing compliance burden.
According to Moody’s, economic sanctions are one of the most widely used foreign policy tools for advancing national security, protecting human rights, and preventing illicit activities such as terrorism and drug trafficking.
These restrictions are often financial in nature, limiting trade and transactions across borders. They can take several forms, including comprehensive measures against whole nations, sectoral restrictions targeting specific industries, or list-based sanctions aimed at individuals and organisations.
The United States Department of the Treasury’s Office of Foreign Assets Control (OFAC) categorises sanctions into three regimes. Comprehensive sanctions prohibit almost all financial and trade activities with specific countries, such as Cuba, Iran, North Korea and parts of Ukraine. Sectoral sanctions are narrower, targeting industries such as defence, energy or finance, while list-based sanctions apply to individuals and companies accused of terrorism, human rights violations, or other illicit activities. The latter typically involve blocking assets or freezing accounts, with names published on OFAC’s Specially Designated Nationals list.
Sanctions can be imposed either autonomously by a single jurisdiction or multilaterally through international bodies such as the European Union or United Nations. For example, US sanctions against Cuba operate independently, while EU sanctions regimes reflect a collective approach. Moody’s analysis of 244 countries, territories, and jurisdictions found that 26% maintain an autonomous sanctions regime, and of these, 84% publish public-facing lists. Although the majority do not implement their own programmes, many align with multilateral regimes, particularly those established by larger blocs.
The complexity of the global sanctions environment has created challenges for banks, financial institutions, multinational corporations and government agencies. Tracking constantly evolving restrictions involves risks that span compliance, legal exposure, operational demands and strategic considerations. The situation is further complicated by the fact that sanctioning bodies may use different lists and definitions, requiring institutions to maintain robust monitoring capabilities to stay compliant.
Moody’s offers screening and monitoring solutions through its Grid platform, which is described as the most comprehensive database for sanctions, politically exposed persons (PEPs), adverse media, and watchlists. Data is sourced from regulators, law enforcement and other official authorities, curated into structured profiles of individuals and organisations. This enables users to quickly identify sanctions exposure and assess risk in detail.
The sanctions database is updated daily and undergoes additional checks to ensure accuracy and completeness, reflecting the importance of reliable sanctions data in compliance processes. For businesses operating across borders, the ability to monitor and respond to new restrictions is a vital part of know your customer (KYC) and wider compliance frameworks.
Moody’s emphasises that staying up to date with sanctions regimes is critical for protecting institutions against financial crime, ensuring regulatory compliance, and maintaining trust with stakeholders. By using automated solutions, businesses can better manage the risks associated with an increasingly fragmented and fast-changing sanctions landscape.
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