The increasing complexity of sanctions regimes and deceptive shipping practices has made vessel checking an important element of trade finance compliance. The ICC's new Financial Crime Risk Controls: Vessel Checking Guide provides a welcome practical perspective, recognising both the importance of vessel checking and the limits of what banks can reasonably achieve.
Banks handling documentary trade may see information that is unavailable in an ordinary payment transaction. Bills of lading can identify vessels, carriers, cargo and routing. However, this does not mean that every maritime risk can be identified from the documents themselves.
Practices such as AIS manipulation, ship-to-ship transfers, flag changes and the activities of shadow fleets will generally not be apparent from normal transaction documents. Identifying these behaviours may require external maritime data and specialist investigation. The Guide therefore supports a proportionate approach mentioning baseline document checking during normal processing, with enhanced investigation where identified risk indicators justify further scrutiny.
Technology can clearly assist. Vessel tracking and external maritime data can identify unusual movements, while container tracking can provide additional insight into routes and transhipments. Better identification is equally important. The Guide highlights the potential value of wider use of a vessel's IMO number on bills of lading, providing a more reliable identifier than a vessel name that may change or generate false screening matches.
There is also an important wider message. Only around 20% of global trade is supported by trade finance, so banks cannot solve maritime financial crime through documentary controls alone.
The objective should therefore not be to check everything simply because technology makes it possible. Effective vessel checking means identifying where the genuine risk lies and applying the appropriate level of scrutiny.
https://iccwbo.org/news-publications/guide/financial-crime-risk-controls-vessel-checking/