A surge in economic sanctions and a tangled web of international blacklists are overwhelming in-house compliance staffs in the U.S. and lifting the ledgers of third-party compliance services.
Companies seeking to navigate an increasingly complex area of business—in particular, the avoidance of doing business with blacklisted companies and individuals—are turning to accounting firms, law firms, and other consultancies that offer services to handle the screening of customers, suppliers and business partners and other compliance functions, The Wall Street Journal reports.
The increased use of sanctions as a foreign policy tool over the past few years has driven demand. In 2018, more than 1,450 individuals or entities were added to the designation list, more than twice the annual average over the previous 10 years.
Companies’ compliance efforts have also come under closer scrutiny, with fines issued by the U.S. Treasury Department’s Office of Foreign Assets Control hitting a decade high in 2019.
Companies’ in-house compliance teams, as well as compliance consulting firms, have bulked up in response to these shifts, causing the availability of compliance professionals to dwindle.
The average unemployment rate for compliance professionals was 0.2% at the end of 2019, down from 5.1% at the end of 2017, according to the U.S. Bureau of Labor Statistics.
In-house compliance teams are increasingly training existing staff to handle the growing compliance burden, says Paul McDonald, a senior executive director at global staffing company Robert Half. Those who can’t hire or train quickly enough—or don’t have the budget to build their own compliance teams—are increasingly looking for outside help. Read the full story.
