Concentrated wealth, state involvement and cross-border trading chains give oil, gas and mining a well-documented corruption and sanctions exposure — the proceeds of which have to be laundered somewhere.
The rating above is indicative — it reflects inherent risk as assessed in the published frameworks, not a verdict on any business. Entire industries serve these sectors as business as usual; the rating your firm actually applies comes from its own business-wide risk assessment, where the sector factor combines with your customer base, controls and risk appetite.
FATF typology work on laundering the proceeds of corruption repeatedly features the extractive industries: licences and state contracts worth enormous sums are awarded by officials, which draws politically exposed persons, intermediary 'agents' and disproportionate consultancy fees into deals. Transparency initiatives such as EITI exist precisely because of this exposure.
The sector also carries acute sanctions risk: sectoral measures against Russian oil (including the oil price cap), shadow-fleet shipping and origin-obscuring trading chains mean a counterparty's cargo, vessel and payment route can all raise issues even where the counterparty itself is not listed.
Firms serving the sector must apply enhanced due diligence to PEP- and state-linked counterparties, screen vessels and cargo routes as well as parties against sectoral sanctions, and scrutinise the source of funds behind acquisitions and fees. Sector risk combines with geography, the customer’s profile and the product to set the overall rating — and every client still needs sanctions, PEP and adverse-media screening on the parties themselves.
