The foreign policy tool of sanctions, conflict and ensuring continued access to finance
| Date | 03 July 2017 |
| Pages | 480-490 |
| DOI | https://doi.org/10.1108/JFC-05-2017-0035 |
| Published date | 03 July 2017 |
| Author | Justine Suzanne Walker |
| Subject Matter | Accounting & Finance,Financial risk/company failure,Financial crime |
The foreign policy tool of
sanctions, conict and ensuring
continued access to nance
Justine Suzanne Walker
British Bankers Association, London, UK
Abstract
Purpose –This paper argues that the current framework permitting humanitarian transactions into
sanctioned and conict environments needs re-thinking and updating.
Design/methodology/approach –This paper is based on in-depth interviews conducted with banks,
humanitarian actors, regulators and government ofcials. It incorporates a review of relevant literature and
has involved extensive eld-based observations including with jurisdictions experiencing conict or subject
to sanctions.
Findings –This paper nds that a recalibration of the sanctions architecture is required and that a new
equilibrium needs to be created to ensure the ability of international banks to support permissible
humanitarian and development payments. It further sets out that the foreign policy intention of economic
sanctions, when combined with licensing complexity and other risk factors, such as terrorist nancing, are not
achieving their intended goals.
Originality/value –Assessment on the strategic importance of ensuring access to nancial services for
jurisdictions subject to sanctions and in conict.
Keywords Syria, Risk management, Sanctions, Humanitarian aid
Paper type Research paper
Introduction
Access to nancial services is at the very heart of the international quest for sustainable
development and inclusion. Yet, when access becomes limited, or indeed overly complicated,
the pillars of inclusion, sustainability and even foreign security begin to ounder.
Unintended consequences of de-risking
The unintended consequences of changing anti-money laundering/counter-terrorist
nancing, as well as risk management and regulatory frameworks, have for some parts of
the world had a profound effect. The decline in the provision of correspondent banking
services and access to nancial services for remittance providers, while widely documented
is not the full picture.
In the wake of concerns about terrorist nancing, the global trend toward banks (large
and small) de-risking, and the withdrawal of nancial services provision for perceived higher
risk jurisdictions, sectors and groups, is clearly on the upward curve. To better understand
why this trend is occurring, signicant work has been advanced by a variety of institutions,
including the International Monetary Fund and World Bank Group. World Bank surveys,
carried out from April to October 2015, provide evidence that access to nancial services for
local, regional banks and remittance providers is contracting in some countries and regions.
The views expressed are those of the author alone and should not be read as being those of any other
body.
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/1359-0790.htm
JFC
24,3
480
Journalof Financial Crime
Vol.24 No. 3, 2017
pp.480-490
©Emerald Publishing Limited
1359-0790
DOI 10.1108/JFC-05-2017-0035
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