2.3. Sanctions Risk Appetite

Effective from 4/7/2021

LFIs should develop and maintain a comprehensive written sanctions risk appetite approved by the LFI’s senior management and embedded through policies, procedures, and screening systems parameterization.

	•	The sanctions risk appetite should specify which sanctions regimes are applicable to the LFI (for example UNSCR, OFAC, EU, UK etc.).
	•	LFIs should specify their policy on treating of interests, properties, assets, or entities that are owned or controlled 50% or more by a Listed Person.
	•	LFIs should specify their approach on mitigating the risk of breaching of unilateral sanctions, especially in the context of sanctions that may have extra-territorial implications or the Listed Persons may or may not have a presence in UAE (for example secondary sanctions by OFAC).
	•	LFIs should specify their approach on screening of alias names such as one word synonyms, vessel names or paper based instruments.
	•	LFIs should identify and document any exceptions to sanctions risk appetite or deviations from their policies and procedures; these should be approved by senior management.

For more details and information, please refer to Annex 2 for related Lessons learned from CBUAE Supervision.