Sanctions Act: the importance of it
The Sanctions Act dates from 1977 and was created to combat money laundering and terrorism. Within this Act, the Netherlands implements the sanctions that are in force internationally, in the United Nations and the European Union. As for organizations to which this Act applies, it means that they must identify new and existing clients. They should also check whether there are any sanctions against them. The Sanctions Act is complex. We provide clarity on this page.
Mandatory periodic check
Periodic checks are mandatory under the Sanctions Act. It is therefore important to define a policy. For example, when checking clients' identity, you should find out who the ultimate beneficial owner (UBO) of a business relationship is. You should then check whether there are any sanctions against him. You can check this using the sanction lists. You also find out whether this person has received any negative publicity.
Who is supervising the Sanctions Act?
This role is reserved for the Dutch Central Bank (DNB) and the Netherlands Authority for the Financial Markets (AFM). They proceed according to the Regulation on Supervision of the Sanctions Act 1977. The Dutch Central Bank mainly assesses whether the measures that have been taken are also sufficient. You must immediately inform the DNB about your checks.
What sanctions should you consider?
- If a client turns out to be suspicious, various sanctions can be imposed. The sanctions regulations can be found on the websites of the United Nations, the European Union, and the national government. Sanctions include:
- freezing assets and funds.
- a ban on making financial resources available and
- a ban on or restriction of the provision of financial services.
RegLab for complying with the Sanctions Act
Do you also spend a lot of time on a Know Your Customer and Customer Due Diligence policy to comply with AML requirements and the Sanctions Act? Despite the frustrations they may generate, the KYC principles are becoming increasingly important. RegLab helps organizations to quickly, safely, and easily comply with the Know your Customer policy laws and regulations.
Themed file: fully prepared for the supervisor’s audit
This article is part of a number of articles and downloads that will help you prepare yourself for the supervisor’s visit. This content is based on a supervisor's FAQs during an audit. Do you want to be 100% AML-proof and ready for the supervisor’s visit? Find all FAQs in our Knowledge Centre.