The global maritime and transportation industries have long played a vital role in facilitating the movement of goods and people across borders, writes Captain Steve Bomgardner, VP Commercial Markets, Pole Star Global. However, these industries are vulnerable to exploitation by illicit actors who seek to transport contraband goods, evade sanctions, and launder money.
In a recent announcement, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) highlighted the growing threat posed by illicit cargo shipments and called for heightened vigilance from all stakeholders in the maritime and transportation sectors.
Despite the new era of sanctions compliance challenges that such Deceptive Shipping Practices (DSP)s have created, it is possible to comprehend, detect and mitigate these practices using maritime intelligence services. The key points follow below:
• Deceptive Shipping Practices: Malignant actors utilise deceptive shipping practices to conceal illicit cargo by manipulating location data, tampering with vessel tracking systems, falsifying documentation, and using false identities. Another common method involves counterfeiting cargo and vessel documents to disguise the true nature of shipments. Ship-to-ship transfers at sea are employed to complicate tracking. Additionally, malicious entities use complex ownership or management structures to obscure their control of vessels or companies, making it challenging to identify the true beneficiaries of illicit shipments. What types of DSP’s are there? How can this issue be addressed?
• OFAC’s Advice/Measures for Compliance: The maritime and transportation industries face significant risks from deceptive practices, leading to legitimate cargo diversion, illicit goods proliferation, and eroded trust in the global supply chain. To address these risks, the Office of Foreign Assets Control (OFAC) highlights five key measures for robust compliance. These include establishing effective sanctions and export control programmes, implementing location monitoring best practices, conducting thorough “Know Your Customer” (KYC) investigations, exercising supply chain due diligence, and sharing information with law enforcement. These measures involve comprehensive policies, location history monitoring, rigorous background checks, supply chain risk evaluation, and prompt reporting of suspicious activities to authorities.
• The Power of Maritime Intelligence: Effectively countering deceptive shipping practices and aligning with the five key measures outlined by OFAC presents inherent challenges. However, access to advanced maritime intelligence technology and risk intelligence can empower the maritime and transportation industries to address these complexities. This technology provides a global supply chain overview, enabling proactive identification of red flags. What are the red flags? What other advanced features does maritime intelligence have to combat this issue?