The global sanctions landscape has grown increasingly complex amid recent geopolitical shifts, particularly following the escalation of sanctions against Russia since 2022. Financial institutions (FIs) are now facing unprecedented challenges in maintaining compliance with rapidly evolving and, at times, conflicting sanctions regimes, while simultaneously managing operational pressures, rising compliance costs and heightened risks of fines. Artificial intelligence (AI) presents a compelling opportunity to support FIs in building compliance frameworks that are both more robust and more efficient, not only for sanctions compliance but across all areas of financial crime risk. This paper examines how, by adopting AI solutions, FIs can enhance the effectiveness and efficiency of sanctions compliance while navigating the multifaceted challenges of modern sanctions requirements. The paper also analyses the main barriers to the adoption of AI-driven solutions, offering practical advice on overcoming these obstacles, with a focus on data quality, legacy systems and the evolving role of compliance practitioners. This article is also included in The Business & Management Collection which can be accessed at https://hstalks.com/business/.
Sumkovski et al. (Sat,) studied this question.