When national security meets financial securities

We’ve built a new custom data export with sanctioned securities to make it easier to screen asset management portfolios for sanctions risks.

When you imagine a sanctioned company, it’s easy to think of a Maltese shell corporation registered at a shady law firm’s offices, set up to facilitate the smuggling of arms on behalf of Assad’s Syria. But increasingly, international sanctions are being applied to large, publicly traded companies - for example, in the Russian financial and heavy industry sectors. What’s even more: with Executive Order 14071, the US government has created a general investment ban against Russian securities.

Sanctions also apply to financial instruments, including the purchase and sale of stock in certain companies.

This, of course, creates a problem for asset managers and everyone else involved in the trade of financial securities: which transactions have to be blocked? Unfortunately, sanctions list-makers and asset managers speak in very different languages: the US OFAC lists only mention 160-odd securities identifiers. Most of the identification of companies is instead done by name and jurisdiction.

That’s why we decided to apply some data enrichment to the problem: after previously including Legal Entity Identifiers (LEIs) and some ISIN mappings via the GLEIF database, and Russian securities identifiers via the NSD (National Settlement Depository), we’ve now also integrated PermID/RIC data lookups provided by LSEG (formerly Refinitiv, formerly Reuters), and OpenFIGI identifiers (published by an entity that suspiciously looks like Bloomberg in a trench coat).

On top of that, we’ve built a new custom data export: Sanctioned securities. The data distribution includes all companies designated by the US, UK, EU, Switzerland and Australia, and combines them in a simple CSV file format that indicates all the available financial identifiers available for each entity.

This allows us to demonstrate a proposition that OpenSanctions was very much built for: being an open data nexus that combines multiple sources in a way that makes more sense out of them, and then providing the result in a way that is extremely easy to use.

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This article is part of OpenSanctions, the open database of sanctions targets and persons of interest.