Enforcement

Issue 1163 / 9 June 2022

Overview

  • Breaches of financial sanctions - OFSI publishes updated Guidance on enforcement and monetary penalties

HM Treasury

Breaches of financial sanctions - OFSI publishes updated Guidance on enforcement and monetary penalties - 8 June 2022

The Office of Financial Sanctions Implementation (OFSI), which is part of HM Treasury, has published updated Guidance on enforcement and monetary penalties for breaches of financial sanctions. OFSI has the power to impose monetary penalties for breaches of financial sanctions under the Policing and Crime Act 2017 (the 2017 Act), as amended by the Sanctions and Anti-Money Laundering Act 2018 (SAMLA). Following the Russian invasion of Ukraine, the government brought forward the Economic Crime (Transparency and Enforcement) Act 2022 which included important changes to OFSI’s powers. The measures will commence on 15 June 2022, and the updated guidance reflects these changes.

For breaches of financial sanctions that are committed after 15 June 2022, OFSI will be able to impose civil monetary penalties on a strict civil liability basis. This means the previous requirement to prove that a person had knowledge or reasonable cause to suspect that they were in breach of financial sanctions will be removed, though OFSI will still bear the burden of proof to establish that there was a breach of financial sanctions prohibitions. There is no equivalent change to the financial sanctions criminal legal test or threshold.

OFSI has also gained the power to publicise details of financial sanctions breaches committed after 15 June 2022 where a monetary penalty has not been imposed. These will include a summary of the case and the persons that committed the breach. The power only applies where there is found to be a breach of financial sanctions, and publication will be considered on a case-by-case basis. The changes also introduced flexibility in the review process for monetary penalties.

The Guidance will apply from 15 June 2022.

OFSI Guidance: OFSI enforcement and monetary penalties for breaches of financial sanctions

Updated webpage