FIN.

Government publishes first proliferation financing NRA

Treasury has produced the first comprehensive National Risk Assessment of proliferation financing, setting out the key risks and vulnerabilities the UK faces.

The assessment explains the UK’s role and stance in international markets and the measures it has in place to control its risks. It then goes on to cover how proliferation financing occurs and where the risk touch points can be – for example, explaining the risks of actors who facilitate proliferation financing.

The assessment considers specific risks from specific regimes, primarily North Korea, Iran and chemical weapons activity and how the UK’s AML and financial sanctions regime works to address these.  It looks at OFSI’s compliance strategy and cross-monitoring between relevant government departments.

Key risks are those from direct and indirect proliferation activity, and activity undertaken by state actors. The risks are explained by way of example and case studies. Key vulnerabilities include the sheer size and openness of the UK markets and touchpoints in the insurance and maritime sector, the ease of establishing companies in the UK, designated non-financial businesses and professions and UK Crown Dependencies and overseas territories as well as the risks presented by crypto.

The UK’s key role in global defence also provide opportunities, as does the UK’s role as a global education hub. Generally, also there appears to be limited awareness of proliferation financing in certain elements of the economy.

Emma Radmore