Mr. Sanctions

Category: OFSI (UK)

  • May 19, 2026: OFSI fines Deutsche Bank AG for 2 Russian sanctions breaches

    Office of Financial Sanctions Implementation HM Treasury
    Deutsche Bank AG PenaltyOFSI has imposed a £165,000 monetary penalty on Deutsche Bank AG London Branch (DBLB) for breaches of the Russia financial sanctions regime. 

    Between June and July 2022, DBLB processed two payments totalling £635,618.75 to an entity wholly owned by a designated person. 

    This is the second OFSI monetary penalty case resolved through settlement, demonstrating how proportionate and effective enforcement outcomes can support the rapid communication of compliance lessons to industry. 

    It also underlines the importance of firms maintaining effective sanctions controls, particularly where ownership and control structures determine whether restrictions apply. 

    Key lessons for firms include the importance of: 

    – maintaining suitably robust sanctions screening systems and processes, commensurate with their level of exposure to sanctions risk  
    – having strong onboarding procedures and regular, risk‑based customer reviews especially in higher risk jurisdictions 
    – complete, detailed, and prompt voluntary disclosure of potential breaches to OFSI  

    A 45% discount was applied, reflecting voluntary disclosure and settlement. 

    I had Claude summarize the Penalty Notice:

    OFSI Penalty Notice: Deutsche Bank AG London Branch

    Plain-Language Summary

    SUMMARY

    The UK’s Office of Financial Sanctions Implementation (OFSI) fined Deutsche Bank’s London branch (DBLB) £165,000 for violating UK Russia sanctions. The core violation: DBLB processed two payments in 2022 — totalling about £635,000 — to a company called Okko, which was owned by a sanctioned Russian entity. Because DBLB voluntarily reported the problem and later agreed to settle the case, its original penalty was reduced. The final £165,000 figure reflects both a voluntary disclosure discount and a settlement discount.

    BACKGROUND

    Okko is a Russian streaming service (think a Russian Netflix). Russia’s largest bank, Sberbank, owned Okko until May 2022, when it sold the company to another Russian firm, JSC New Opportunities. The timing matters: Sberbank had just been sanctioned by the UK in April 2022, and JSC New Opportunities was then sanctioned in late June 2022. The moment JSC New Opportunities was designated, Okko automatically became off-limits under UK sanctions — even though Okko itself was never directly listed — because it was wholly owned by a sanctioned party. DBLB’s customer (an Irish-incorporated subsidiary of a multinational firm) instructed DBLB to send the payments to Okko via the SWIFT network.

    THE BREACHES

    Two payments are at the heart of the case:

    • Payment A (~£356,000): Processed on June 29, 2022 — the same day JSC New Opportunities was publicly designated as sanctioned. The funds actually left the account the following day.
    • Payment B (~£279,000): Processed about a month later, on July 27, 2022.

    DBLB did run sanctions screening on both payments, but its third-party screening vendor’s data didn’t include ownership information linking Okko to the newly sanctioned JSC New Opportunities. So no alert was triggered, and the payments went through.

    A third payment (Payment C, ~£1.1 million) was made in April 2022 but was not treated as a breach, because it pre-dated the UK’s strict liability sanctions rules taking effect in June 2022.

    CASE ASSESSMENT

    OFSI weighed factors both for and against DBLB when deciding how serious the case was.

    Factors that made things worse (aggravating):

    • The combined payment value was significant — over £635,000.
    • The money went directly to an entity owned by a sanctioned person, which effectively undermined the asset freeze the UK had put in place against Russia.
    • Russia sanctions were a top UK foreign policy priority in 2022 and remain so.
    • Although DBLB had conversations with its customer about Russia-related payment risks between March and May 2022, it never probed how the customer itself assessed sanctions ownership risks — specifically, that the customer relied on self-certification from its own customers rather than verifying ownership information independently. DBLB missed an opportunity to catch this gap.
    • The earlier Payment C — though not itself penalized — showed DBLB had a pattern of processing payments to Okko and was relevant context.

    Factors treated as neutral:

    • DBLB’s use of a third-party screening vendor is understandable and common practice, but DBLB remained ultimately responsible for its own compliance. The vendor failed to capture publicly available information about Okko’s change of ownership, highlighting a known risk of relying on such providers — made worse by Russia withdrawing information from its public corporate registries in mid-2022.
    • DBLB cooperated with OFSI’s investigation, but its responses were sometimes slow and thin on detail — below what OFSI expects from a large regulated institution.

    Factors that helped DBLB (mitigating):

    • There is no evidence DBLB knew, or had reason to suspect, that the payments were in breach of sanctions — no intent or prior knowledge.
    • Payment A happened on the very day of the designation. The window for cancelling it was extremely narrow, and OFSI acknowledged this. It was only included in the penalty because Payment B followed a month later.
    • DBLB voluntarily disclosed the breaches to OFSI in September 2022 — an important positive step.
    • Since the breaches, DBLB has significantly overhauled its sanctions compliance program: better oversight of third-party vendors, broader Russia-related list coverage, stronger due diligence procedures, and a much more cautious approach to Russia-related payments overall.

    Overall, OFSI rated the case as “serious” — but not the most serious category.

    THE PENALTY CALCULATION

    StepAmount
    Maximum statutory penalty£1,000,000
    Baseline penalty set by OFSI£300,000
    Discount applied (45% — for voluntary disclosure + settlement)–£135,000
    Final penalty imposed£165,000

    The 45% discount was slightly below the maximum 50% available, because while DBLB disclosed promptly, its initial disclosure lacked the detail OFSI expected from a firm of its size and sophistication.

    COMPLIANCE LESSONS

    OFSI used the notice to flag three takeaways for the broader financial industry:

    1. Don’t over-rely on third-party screening tools. They are valuable but have gaps — especially for ownership-and-control risks. Firms must understand those limitations and fill them with their own processes.
    2. Know your customer’s compliance practices. It’s not enough to screen transactions; firms should understand how their customers manage their own sanctions risks, especially where payments go to higher-risk jurisdictions like Russia.
    3. Voluntary disclosure pays — but only if it’s thorough. OFSI rewards early disclosure, but incomplete or vague reporting limits the discount available. Firms should take time to provide a full, detailed account when reporting suspected breaches.

    NOTES ON SETTLEMENT

    This was OFSI’s first (or among its first) cases resolved through its new formal settlement process, introduced in February 2026. Settlement allows both sides to reach a negotiated outcome more quickly than a full contested process. In exchange for a penalty discount and input into the published case summary, DBLB agreed to pay the penalty and waive its right to challenge OFSI’s decision. OFSI views early settlement as being in the public interest — it’s faster, cheaper, and gets compliance messages out sooner.

    The full Penalty Notice:

    DB_Penalty_NoticeDownload

    I do wonder about the severity of the fine, and the relatively harsh assessment of these sanctions violations. Perhaps it’s because patterns of conduct are just smaller outside the US, so the penalties need to be harsher to get people’s attention.

    I will admit, the penalty notice is much more detailed than it used to be. I will note that it took me a while to find that the 3rd party vendor did include ownership and control data, but was either slow or deficient in providing the needed info in this case.

    I also wonder what would have happened had the 2nd payment been stopped. After all, the first payment was processed on the same day as the designation of the parent company (even if value date was the best day).

    All in all, instructive – I will see if I need to tweak the fairly generic prompt for summarizing the penalty notice.

    —

    , , , ,

  • Burning Question: Were the parties updated by OFSI related?

    My prompt to Claude, copy/pasting the names from the email I got from OFSI:

    today, the UK updated the Russian sanctions designations for the following 3 parties: EKC.AG

    Vladimir Viktorovich PLATUNOV

    Evgeny Viktorovich PROKHNYA Do these 3 parties have any relationship between them? Check your work – and list sources.

    And Claude’s response:

    The relationship here is direct and well-documented. Here’s the full picture:

    The Core Relationship: EKC.AG, Platunov, and Prokhnya/Porokhnya are co-owners and directors of the same corporate network.

    EKC.AG is a Germany-based company headquartered in Bavaria, led by Vladimir Platunov, a Russian citizen who has lived in Germany since the 1990s. Evgeny Porokhnya is also part of the company’s leadership team and holds a Russian passport.

    EKC.AG was originally founded in 2006 as “Europakontakt e.K.” by Vladimir Platunov, today’s CEO of EKC.AG — a globally active raw materials trader specializing in energy and industrial resources.

    German corporate registration records list both Vladimir Platunov and Evgeny Porokhnya as Managing Directors across multiple related entities, including Europakontakt Management GmbH, with a registered seat in Würzburg.

    Why they were designated:

    EKC.AG is described as a Germany-based raw materials trader and part of a network supplying the Russian defense sector with critical minerals used to produce armaments. EKC.AG’s co-owners, Russian nationals Evgeny Viktorovich Porokhnya and Vladimir Viktorovich Platunov, are among those sanctioned for enabling and supplying the Russian defense sector.

    From January 2023 to April 2024, EKC exported chromium worth approximately 24 million euros to Russia, which accounted for more than half of total annual imports of that metal into Russia during the period. The defense industry uses chromium to protect cannon barrels from severe wear and shells from corrosion, with the durability of artillery pieces tripling with chromium use. Among EKC’s clients was Uralvagonzavod, a key producer of armored vehicles for the Russian military.

    The UK’s statement of reasons for Platunov makes the ownership link explicit: Platunov owns or controls directly or indirectly, or works as a director of, EKC.AG and EK-RESOURCE LLC, which are providing financial services, or making available funds, economic resources, goods or technology, that could contribute to destabilising Ukraine. His listed positions include CEO of EKC.AG, Commercial Director of EK-RESOURCES LLC, and Director of P&P HOLDING GMBH.

    Original designation date: On February 24, 2025, the United Kingdom included EKC.AG in its sanctions list. In response, the company announced its intention to challenge the sanctions in court, calling them unlawful. Platunov and Porokhnya were designated in the same notice.

    ⚠️ Name Spelling Flag — Check Your Source

    There is a discrepancy worth checking. You’ve listed the individual as PROKHNYA, but every authoritative source — including the UK’s own OFSI financial sanctions notice, the GFSC notice, OpenSanctions, and secondary legal commentary — spells the surname POROKHNYA (Evgeny Viktorovich POROKHNYA, UK Unique ID: RUS2443). Today’s update may involve a correction to the transliteration, or there may be a data entry issue on your end. I’d recommend cross-referencing today’s actual FCDO sanctions notice PDF against the UK consolidated list before publishing.

    Sources:

    1. UK OFSI Financial Sanctions Notice, 24 February 2025 (via CIMA.ky mirror): statement of reasons for Platunov/RUS2442
    2. Curtis, Mallet-Prevost legal update, March 2025 — curtis.com
    3. Odessa Journal reporting on EKC.AG chromium exports — odessa-journal.com
    4. LeaveRussia.org company profile — leave-russia.org/ekc-ag
    5. NorthData German corporate registry (Platunov/Porokhnya co-directorships) — northdata.com
    6. GFSC Sanctions Notice (Guernsey FSC) — gfsc.gg
    7. OpenSanctions entries for both individuals — opensanctions.org

    That last little bit was a good catch on Claude’s part – if you follow the link to FCDO’s designation page, you find the spelling is POROKHNYA

    The point of the exercise? It’s easy to see 3 designations or updates and miss the bigger picture of how they might be related. It’s harder for that to happen with new designations, at least in the US, because the press releases from Treasury or State often lay those out (often with greater detail and context than you get in the actual designation).

    I think it’s an exercise worth repeating from time to time, if not all the time…

    —

    , , ,

  • May 15, 2026: More OFSI tweaks to its Russian sanctions list

    UK Gov logo, 50% resolution.png

    Today, Friday 15 May, the UK Government has varied the following 3 designations and made 1 administrative amendment, all sanctioned under the Russia Sanctions Regime.

    Variations:

    Name:Unique ID:
    EKC.AGRUS2441
    Vladimir Viktorovich PLATUNOVRUS2442
    Evgeny Viktorovich PROKHNYARUS2443

    Amendment:

    Name:Unique ID:
    LIMITED LIABILITY COMPANY “ZHEMCHUZHINA”RUS3600

    The sanctions notice:

    Sanctions_Notice__Russia__15_May_2026Download

    —

    , ,

  • May 14, 2026: OFSI tweaks its Russian, Afghanistan and Iran designations

    UK Gov logo, 50% resolution.png

    Today, Thursday 14 May, the UK Government has revoked 1 specification, varied 1 designation, and made 3 amendments to designations imposed under the Russia Sanctions Regime.

    Revoked Specification:

    Name:IMO Number:Unique ID:
    MILLEROVOIMO 9035541RUS2605

    Varied Individual:

    Name:Unique ID:
    Yulia GURYEVA-MOTLOKHOVRUS2066

    Amended Individuals:

    Name:Unique ID:
    Pavel Valerevich NIKITINRUS3515
    Dmitriy Evgenievich SHEVCHENKORUS3519
    Timofey Vladimirovich VASILIEVRUS3573

    Furthermore, the UK Government has amended 4 designations made under the Iran Sanctions Regime.

    Amended Individuals:

    Name:Unique ID:
    Namiq SALIFOVIRN0269
    Nihat Abdul Kadir ASANIRN0270
    Reza HAMIDIRAVARIIRN0271
    Farhad ZARRINGHALAMIRN0274

    Lastly, the UK Government has amended 1 designation made under the Afghanistan Sanctions Regime.

    Amended Individual:

    Name:UN ID:Unique ID:
    Nooruddin Turabi Muhammad QASIMTAi.058AFG0046

    Heres’s the sanctions notices – Russia:

    Sanctions_Notice__Russia__14_May_2026Download

    Iran:

    Sanctions_Notice__Iran__14_May_2026Download

    and Afghanistan:

    Sanctions_Notice__Afghanistan__14_May_2026Download

    —

    , , , ,

  • Burning Question: What’s in OFSI’s Financial sanctions guidance for High Value Dealers & Art Market Participants?

    Here is the complete summary:

    What Is This Document?

    This guidance is produced by the Office of Financial Sanctions Implementation (OFSI), part of HM Treasury, the authority for the implementation of financial sanctions in the UK. It provides financial sanctions guidance for entities and individuals that operate in the sale or trade of high value goods, especially those trading internationally with regions that may be subject to UK financial sanctions restrictions.

    In short: if your business buys, sells, stores, insures, or transports high-value goods — art, luxury cars, precious metals, jewellery, fine wine — this document sets out your legal obligations under UK financial sanctions law.

    Who Does This Apply To?

    High Value Dealers (HVDs)

    A “high value dealer” is defined as a firm or sole trader that by way of business trades in goods (including an auctioneer dealing in goods), when the trader makes or receives, in respect of any transaction, a payment or payments in cash of at least £10,000 in total, whether the transaction is executed in a single operation or in several operations which appear to be linked. This refers to physical cash only and does not include bank transfers or digital payments.

    Art Market Participants (AMPs)

    An art market participant is defined as a firm or sole practitioner who is registered or required to register with HMRC as an art market participant under the Money Laundering Regulations. Their obligations apply when they trade in or act as an intermediary in art sales of £10,000 or more, or store works of art worth £10,000 or more for a single person.

    Both categories were added to the list of “relevant firms” subject to financial sanctions reporting requirements from 14 May 2025.

    Why Does This Sector Get Special Attention?

    The UK is a major international hub for the trade of high value goods, including art, antiques, luxury cars, precious metals and gemstones, and for investment in wines and whiskies. In 2023, global art sales were USD $65 billion and the UK had the third largest share at USD $11.05 billion, accounting for 17% of the world market.

    This scale, combined with the sector’s characteristics — high-value, portable, often privately traded — makes it attractive to sanctioned individuals seeking to move or hide wealth.

    How Sanctioned Persons Try to Exploit This Sector

    The guidance identifies several red flags to be aware of:

    Shell companies and intermediaries. Intermediaries and shell companies are often used to source, buy, or sell high value goods, and any associated payments. Such anonymity and obfuscation has been used to conceal the involvement of a designated person in a transaction.

    Asset movement. The movement of assets, including the sale of high value assets that were previously associated with a designated person, by family members or otherwise on their behalf, where funds are then disbursed offshore through secrecy jurisdictions, is an indicator suspected of being used to evade sanctions.

    Unclear payment sources. It may be indicative of sanctions evasion if there is a lack of clarity on the source of payment or funds, a concealment of the ultimate beneficial owner of the goods, transactions being made through offshore accounts, or a change in payment arrangements.

    Difficulty tracing goods. It is commonplace for goods to move between jurisdictions, making such movements less noteworthy when being done for the purposes of sanctions evasion — precious metals and stones in particular are very durable and effectively untraceable.

    Digital assets. Cryptocurrencies and NFTs may be used by designated persons in an effort to circumvent restrictions applied through financial sanctions. Those using, trading in and dealing with cryptocurrencies or NFTs are also subject to these regulations and must apply due diligence.

    What Are Your Main Obligations?

    1. Due Diligence

    The onus is on you to ensure that you have put in place sufficient measures to ensure you do not breach financial sanctions. Enhanced due diligence checks on your customers and payment chains may be needed.

    Practically, this means routinely checking the UK Sanctions List — not just when you start a new client relationship, but at every significant stage of a transaction, since the list is updated continuously.

    2. Reporting to OFSI

    Reporting obligations apply to relevant firms who are required to inform OFSI as soon as practicable if they know or have reasonable cause to suspect a person is a designated person or has committed a breach. When reporting to OFSI you must include the information or other matter on which the knowledge or suspicion is based, and any information you hold about the person by which they can be identified.

    If the suspect person is actually your customer, you must also report how much in funds or assets you are holding for them.

    3. Freeze and Stop

    If you discover a client or counterparty is sanctioned, you must immediately stop dealing with them, freeze any assets you hold on their behalf, and notify OFSI.

    4. Ownership and Control

    An asset freeze and/or some financial services restrictions may apply to entities or individuals which are owned, held or controlled, directly or indirectly, by a designated person. Those entities or individuals may not be designated in their own right, so their names may not appear on the sanctions list. However, those entities and individuals are also subject to financial sanctions.

    The ownership threshold that triggers this is more than 50% of shares or voting rights, or effective control of the entity.

    What Are the Penalties for Getting This Wrong?

    The consequences are serious. OFSI has powers to impose monetary penalties of up to £1 million or 50% of the total value of the breach, whichever is higher. Breaches of financial sanctions are also a serious criminal offence, punishable by up to 7 years imprisonment on conviction on indictment, and up to 12 months on summary conviction in England and Wales.

    Failure to comply with reporting obligations is itself an offence. A person who commits this offence is liable on summary conviction to imprisonment for a term not exceeding 6 months, or a fine, or both.

    The guidance includes a real-world case study: an investigation that concluded in 2023 found that around £1 million of artwork belonging to a US-sanctioned terrorist financier was being stored in warehouses in the UK. The artwork was seized and later forfeited by law enforcement under the Proceeds of Crime Act, and a man was arrested on suspicion of terrorist financing.

    Financial vs. Trade Sanctions — An Important Distinction

    OFSI deals with financial sanctions and the Department for Business and Trade (DBT) deals with trade sanctions. These different types of sanctions have differing processes, for instance in licensing activity. It is therefore important to consider the relevance of both financial and trade sanctions to your business.

    In practice: OFSI handles the “who” (frozen assets of designated persons), while DBT/OTSI handles the “what” (restricted goods and services). A business in the high-value goods sector may need licences from both.

    ⚠️ What Changed in the May 12, 2026 Update

    The guidance was updated on May 12, 2026 — the day before the Sanctions (EU Exit) (Miscellaneous Amendments) Regulations 2026 came into force — to reflect one substantive legal change:

    The reporting threshold currency switched from euros to pounds sterling.

    Previously, the definitions of “high value dealer” and “art market participant” referenced a threshold of €10,000. Across all UK sanctions regulations, the definitions of high value dealers and art market participants within the relevant firms regulations are being updated so that monetary thresholds are expressed in pounds sterling (£) rather than euros (€). In particular, the €10,000 threshold is being replaced with a £10,000 threshold.

    The guidance now reflects this: the £10,000 figure appears throughout sections 2.1 and 2.2 in place of the old euro amount.

    This aligns sanctions reporting obligations with upcoming changes to the UK’s money laundering regulations, so firms are not reporting in two different currencies. The Explanatory Memorandum describes this as a technical alignment measure rather than a change in policy, though the practical sterling equivalent of the old euro threshold will vary with exchange rates.

    Practical effect for businesses: If your compliance systems and internal policies referenced €10,000 as the trigger for cash-transaction reporting (HVDs) or art transaction/storage reporting (AMPs), they should now reference £10,000.

    —

    , ,

  • Burning Question: What’s in The Sanctions (EU Exit) (Miscellaneous Amendments) Regulations 2026?

    Here is a plain-language summary of the Sanctions (EU Exit) (Miscellaneous Amendments) Regulations 2026 (S.I. 2026/443), which comes into force on 13 May 2026.

    What Is This Document?

    This is the official Explanatory Memorandum — essentially the government’s own plain-English explanation — for a package of amendments to 36 different UK sanctions regimes. It was prepared by the Foreign, Commonwealth & Development Office (FCDO). Think of it as a housekeeping and strengthening exercise: the government is not creating new sanctions programs, but is tightening, clarifying, and modernizing the rules across the board.

    The Key Changes, In Plain Terms

    1. New “End-Use Controls” on Exports — The Most Significant Change

    The regulations introduce a prohibition on UK exports of UK-sanctioned goods to a non-sanctioned third country where the government has determined there is a high risk that the goods will ultimately be diverted to a sanctioned jurisdiction.

    What this means in practice: Previously, if a UK business exported goods to, say, a country in Central Asia, and the UK government warned that those goods might end up in Russia, the business could legally proceed anyway. The previous policy was merely to engage relevant businesses and highlight the risk of diversion, which did not sufficiently mitigate the risk because a significant proportion of exporters chose to continue with the export even when they were not able to provide evidence that the risks had been mitigated.

    Under the new rules, once an exporter has been formally “informed” by the Secretary of State for Business and Trade of the diversion risk, they will be required to obtain an export licence before proceeding. The government will assess each application on a case-by-case basis and can refuse the licence if the diversion risk is not adequately mitigated.

    Why now? The greatest risk of diversion is currently to Russia. Despite UK bilateral trade in goods with Russia being down 97% compared with 2021, Russia and other sanctioned destinations are still managing to obtain items indirectly from the UK and allied nations. This measure responds directly to a government review published in May 2025 that recommended introducing exactly this kind of control.

    This applies across all UK sanctions regimes that include trade restrictions.

    2. Currency Change: Euros → Pounds Sterling for Reporting Thresholds

    The regulations update the definitions of “high value dealer” and “art market participant” within sanctions reporting requirements, so that monetary thresholds are expressed in pounds sterling rather than euros.

    What this means: Businesses such as high-end art dealers, jewellers, and luxury goods retailers who accept large cash payments have reporting obligations under both money laundering and sanctions rules. Those thresholds were previously set in euros (a legacy of EU membership). They are now being converted to pounds, aligning sanctions rules with the updated Money Laundering Regulations. This removes unnecessary complexity for firms subject to reporting requirements and supports clearer, more coherent regulatory expectations.

    3. Licensing Notices Can Now Be Sent Electronically Without Prior Consent

    Previously, sanctions regulations stipulated that electronic notices relating to licences could only be issued with the recipient’s prior consent. The regulations modernise these provisions by confirming that licensing authorities may issue notices electronically without prior consent.

    What this means: OFSI (the Office of Financial Sanctions Implementation, the UK’s sanctions licensing body) can now communicate with businesses by email as a matter of course, without first having to get prior consent that email is acceptable. A minor but practical modernisation.

    4. Broader Licensing for Pre-Existing Obligations (“Prior Obligations”)

    The regulations update the prior obligations licensing ground, which enables payments or transfers to satisfy obligations that arose before a person was designated under financial sanctions. The previous drafting was narrow, preventing the licensing of some legitimate pre-existing obligations and creating uncertainty for businesses and individuals.

    What this means: When someone gets added to the sanctions list, businesses they had prior contracts with sometimes need a licence to complete or settle those existing obligations (e.g., to pay a bill that predates the designation). The old rules were too restrictive, making it hard to get such licences approved. The amendment broadens the licensing ground so that under UK autonomous regimes, prior obligations may be met using any funds and by any person, including owned or controlled entities, enabling a wider range of legitimate prior obligations to be licensed while maintaining appropriate safeguards against sanctions circumvention.

    Note: this flexibility applies to UK-only (“autonomous”) sanctions regimes. Where UN Security Council resolutions are involved, the rules remain more restricted to comply with international obligations.

    5. Clarity on Treasury Debt Payments Through Long Payment Chains

    The regulations clarify that the existing exception for payments relating to UK government debt (Treasury debt) applies to all transfers of funds made as part of the payment chain, not just to direct payments from HM Treasury.

    What this means: Some UK government debt (such as gilts) may be held by sanctioned persons. There was ambiguity about whether intermediaries in a payment chain — banks passing payments along — were protected by the exception when making such payments. The amendment makes clear that the protection covers every link in the chain.

    6. Technical and Housekeeping Fixes

    Three further changes are purely technical:

    • Zimbabwe correction: A previous set of amendments incorrectly referred to “the Treasury” instead of “the Secretary of State” in Zimbabwe sanctions designation procedures. This is corrected to restore consistency across all UK sanctions regulations.
    • Russia and North Korea ship specification: Language in the Russia and DPRK sanctions regulations about the procedure for designating specific ships is being updated to reflect what was already enacted in the Economic Crime Act 2022, purely for clarity.
    • Sentencing provisions: Outdated wording about maximum prison sentences for customs-related sanctions offences is being removed. The Finance Act 2024 changed the relevant sentencing framework, making existing wording in sanctions regulations redundant. Sanctions offences of this nature will remain subject to a 10-year maximum imprisonment period.

    Who Is Affected?

    The regulations apply to the whole of the United Kingdom and also to conduct by UK persons where that conduct is wholly or partly outside the UK. A “UK person” includes both UK nationals and companies incorporated under UK law.

    The most practically significant impact is on exporters of goods to third countries who may need to be alert to end-use diversion risks. The estimated annual net cost to business is expected to be £0.1 million, with only a small number of additional exports expected to require licences. The government estimates the annual cost to the public sector (licensing and enforcement) at £1.4 million.

    Bottom Line

    This is a broad but largely technical update to the UK’s sanctions framework. The one genuinely new and substantive measure is the end-use export control — exporters of sanctioned goods to third countries can no longer simply ignore government warnings about diversion risk. Once officially notified of that risk, they must obtain a licence or stop the export. Everything else is clarification, modernisation, and consistency-tidying across a large number of existing sanctions regimes.

    —

    , ,

  • May 12, 2026: OFSI makes regulatory updates

    Office of Financial Sanctions Implementation HM Treasury

    Changes to UK sanctions regulations – overview for firms

    We are writing to give you notice of changes made to the Sanctions (EU Exit) (Miscellaneous Amendments) Regulations 2026. The regulations have now come into force.

    What’s changed 

    Changed relevant firms reporting from euros to pounds 

    • Across all UK sanctions regulations, the definitions of high value dealers and art market participants within the relevant firms regulations are updated so that monetary thresholds are expressed in pounds sterling (£) rather than euros (€). In particular, the €10,000 threshold is being replaced with a £10,000 threshold. 
    • This aligns sanctions reporting obligations with upcoming changes to those in the UK money laundering regulations, so firms are not reporting in two different currencies. 

     Electronic notices for licences 

    • The law has been updated to confirm that OFSI and other authorities can send notices for licences electronically without needing consent for this approach. This reflects how communications already work and removes an outdated technical requirement. 

    HM Treasury debt exception 

    • A clarification that the exception for Treasury debt applies to all transfers of funds across the entire payment chain, including intermediaries. 

    Updates to the prior obligations licensing ground 

    • The SI broadens the prior obligations licensing ground, giving OFSI greater flexibility to license legitimate pre-designation obligations in appropriate cases while maintaining safeguards against sanctions circumvention. 

    FAQs updated

     Further information can be found here 

    Here are the updated Frequently-Asked Questions:

    137. If I am a HVD carrying out a transaction over the value of £10,000 via card transaction, am I exempt from reporting requirements?  

    If you are a HVD, the relevant firm reporting requirement applies only when you make/ receive a payment (or payments) in cash of at least £10,000. This therefore does not include payments via bank transfer or digital payments.

    Amended on: 12 May 2026

    138. If I am an AMP carrying out a transaction over the value of £10,000 via card transaction, am I exempt from reporting requirements?  

    If you are an AMP, the reporting requirement applies regardless of how the transaction (or series of linked transactions) is made, where the transaction has a value of £10,000 or more.

    Amended on: 12 May 2026

    and the new one:

    185. The Prior Obligations licensing ground has been amended by The Sanctions (EU Exit) (Miscellaneous Amendments) Regulations 2026. What has changed in practice?

    The prior obligations licensing ground enables payments or transfers to satisfy obligations that arose before a person was designated under financial sanctions. The Sanctions (EU Exit) (Miscellaneous Amendments) Regulations 2026 amended this ground so that it is now applicable to a broader range of scenarios.  

    In practice, this expands the range of situations in which OFSI may consider licensing payments to satisfy prior obligations, subject to a case-by-case assessment. The change comes into force from 12 May 2026.  

    Under the amended ground: 

    1. It is no longer a condition that the funds or economic resources used to satisfy a prior obligation must be frozen under UK sanctions. 
    2. The limitations on whose funds or economic resources may be used (generally, those belonging to the DP or owned or controlled entity who owes the relevant prior obligation) have also been amended.  
    • For DPs under UK autonomous sanctions, those limitations have been removed.  
    • For UN DPs, where prior obligations licensing grounds apply, those limitations have been amended to allow the prior obligations of owned or controlled entities to be satisfied using the funds or economic resources of the DP, or of other owned or controlled entities. The assets of owned or controlled entities may also be used to satisfy prior obligations of the DP, as was the case previously. 

    Other limitations may apply, so it is important to check a specific regime to understand what may be permitted. For example, some regime-specific amendments have been made to the Iran Nuclear, Libya and DPRK regimes. Likewise, some regimes like Afghanistan do not have a prior obligation ground at all.  

    The changes do not mean that all payments relating to prior obligations will be permitted. OFSI retains discretion to refuse to grant a licence which falls within the relevant prior obligations ground even when the conditions are met, or to licence only a proportion of that obligation. For more information on OFSI’s licensing processes, please refer to our guidance.

    Added on 12 May 2026

    Here’s where those other links lead:

    —

    , ,

  • May 11, 2026: … and an OFSI Iran sanctions update

    UK Gov logo, 50% resolution.png

    Today, Monday 11th May, the UK Government has designated the following 9 individuals and 3 entities under the Iran Sanctions Regime.

    Individuals designated:

    Name:Unique ID:
    Ekrem Abdulkerym OZTUNCIRN0268
    Namiq SALIFOVIRN0269
    Nihat Abdul Kadir ASANIRN0270
    Reza HAMIDIRAVARIIRN0271
    Farhad ZARRINGHALAMIRN0274
    Fazlolah ZARRINGHALAMIRN0275
    Mansour ZARRINGHALAMIRN0278
    Nasser ZARRINGHALAMIRN0279
    Pouria ZARRINGHALAMIRN0280

    Entities designated:

    Name:Unique ID:
    ZINDASHTI NETWORKIRN0272
    BERELIAN EXCHANGEIRN0273
    GCM EXCHANGEIRN0277

    The sanctions notice:

    Sanctions_Notice__Iran__11_May_2026Download

    —

    , ,

  • May 11, 2026: OFSI makes updates to Russia sanctions

    UK Gov logo, 50% resolution.png

    Today, Monday 11 May, the UK Government has designated the following 63 individuals and 22 entities and under the Russia (Sanctions) (EU Exit) Regulations 2019. 

    Individuals designated: 

    Name:Unique ID:
    Yulia Sergeevna VELICHKO RUS3516
    Nadezhda Nikolaevna BOLTENKO RUS3517
    Andrey Alexandrovich USTINSKIKH RUS3581
    Grigory Alexandrovich GUROV RUS3585
    Vladislav Nikolaevich GOLOVIN RUS3584
    Mikhail Yuryevich DRUZHININ RUS3589
    Olga Sergeyevna DRUZHININA RUS3595
    Iryna Viktorivna KRAVCHENKO RUS3598
    Oleg Igorevich OVCHARENKO   RUS3518
    Dmitriy Evgenievich SHEVCHENKO   RUS3519
    Mikhail Alekseevich SHMOYLOVRUS3520
    Maksym Mykolayovych SHVETS RUS3521
    Mikhail Anatolyevich SURKOV RUS3522
    Vladislav Vadimovich IGIN RUS3523
    Artem Alekseevich MARFIN RUS3524
    Ekaterina Mikhailovna RUDKOVSKAYARUS3525
    Ekaterina Dmitrievna KURASHOVARUS3526
    Angelina Gennadyevna KUCHEROVARUS3527
    Ekaterina Alekseevna ANTIPOVARUS3528
    Irina Vasilyevna SURAZAKOVARUS3529
    Anton Andreevich PETROVRUS3530
    Yan Gennadyevich NALIMOVRUS3531
    Gulnara Vilsurovna ANDROSOVA RUS3532
    Igor Vladimirovich BOGATYREV RUS3533
    Armen Genrikhovich ASRIYANRUS3534
    Vladimir Igorevich GOLOVASHIN RUS3535
    Ilya Vladimirovich LIPKINDRUS3536
    Alexander Pavlovich KOCHETOVRUS3537
    Alexey Andreevich KLIMOVSKYRUS3538
    Dmitriy Anatolievich KHOKHLYUSHKINRUS3539
    Dmitriy Vasilyevich TKALYARUS3540
    Vladimir Viktorovich KREMLEVRUS3541
    Sergey Nikolaevich KORSUNRUS3542
    Sergey Evgenievich NAZIULINRUS3543
    Aleksandr Petrovich PRIGORNEVRUS3544
    Pavel Pavlovich DEMESHEVRUS3545
    Oleg Igorevich LUKYANENKORUS3546
    Kira Vadimovna NEKRASOVARUS3547
    Vladislav Alexandrovich POGREBNOY RUS3548
    Sergey Vyacheslavovich TATTIRUS3549
    Daria Sergeevna LAVRIKOVARUS3550
    Yuliya Vitalyevna POGREBNAYARUS3551
    Olga Alexandrovich POLOSINARUS3552
    Elizaveta Alekseevna FETISOVARUS3553
    Viktoriya Igorevna GORDEEVARUS3554
    Maria Sergeevna KUZNETSOVARUS3555
    Alina Maratovna GABIDULLINARUS3556
    Vladimir Aleksandrovich TROSHIN RUS3557
    Evgeniya Valentinovna LUSS RUS3586
    Denis Maksimovich DOLGOV RUS3558
    Alina Vladimirovna KOPYTOVA RUS3559
    Dmitriy Valeryevich LUKIENKO RUS3560
    Mikhail Alexandrovich BARAEV RUS3561
    Viktor Nikolaevich OSTRESHKO RUS3562
    Anastasia Olegovna KAZAKOVA RUS3563
    Anastasia Vadimovna ALTUNINA RUS3564
    Timofey Alekseevich BELOV RUS3565
    Alexey Vladimirovich MEDVEDEV RUS3566
    Mikhail Vladimirovich BIYUN RUS3567
    Anna Vladimirovna ANTIPOVA RUS3568
    Irina Vladimirovna NIKITYUK RUS3569
    Vladimir Grigorievich TABAK RUS3572
    Timofey Vladimirovich VASILIEV RUS3573

    Entities Designated: 

    Names:Unique ID:
    THE  CENTRE FOR MILITARY-SPORTS TRAINING AND PATRIOTIC UPBRINING OF THE YOUTH “WARRIOR”RUS3582
    CENTRE FOR THE STUDY OF THE YOUTH ENVIRONMENT AND MONITORING OF NETWORKSRUS3583
    LLC “ITS SEVGU”RUS3577
    STATE BUDGETARY INSTITUTION OF THE REPUBLIC OF CRIMEA “CLINICAL SANATORIUM FOR CHILDREN AND CHILDREN WITH PARENTS “ZDRAVNITSA”RUS3578
    OOO “Art-Kvest”RUS3591
    GAU MTs “Selet – AK Bars”RUS3592
    FGBU DOP “ROSSIYA”RUS3593
    GUP RK “SOLNECHNAYA TAVRIKA”RUS3594
    DOL “ZHEMCHUZHINA”RUS3600
    OOO “DOLP IM. A.V. KAZAKEVICHA”RUS3599
    GBUZRK “CHILDREN’S HOUSE “YOLOCHKA”RUS3601
    FGBU “DOP “RADUGA”RUS3588
    FEDERAL STATE AUTONOMOUS EDUCATIONAL INSTITUTION OF HIGHER EDUCATION “SEVASTOPOL STATE UNIVERSITY”RUS3590
    GBUZRK “KPB No 5”RUS3596
    LLC “TSRIPTB”RUS3597
    GBU DO RK “DOTs “Alyye Parusa”RUS3579
    INTERNET DEVELOPMENT INSTITUTERUS3574
    EUROVIEWRUS3575
    GOVORITRUS3576
    ANO STRATEGIC COMMUNICATIONS CASPIAN 2030RUS3570
    EXPERT INSTITUTE FOR SOCIAL RESEARCHRUS3571
    SONGDOWON INTERNATIONAL CHILDREN’S CAMPRUS3580

    here’s the sanctions notice:

    Sanctions_Notice__Russia__11_May_2026Download

    —

    , ,

  • May 11, 2026: A decade of OFSI… a blog post

    Office of Financial Sanctions Implementation HM Treasury
    Marking 10 years of OFSI: partnership, progress and the future of financial sanctions At the end of April, OFSI marked its 10th birthday by hosting an international conference on financial sanctions at HM Treasury, bringing together partners from across government, industry and international organisations. Thank you to everyone who attended and contributed to the discussion. 

    The event reflected on how UK financial sanctions have evolved over the past decade, and the role they play in an increasingly complex global environment. 
    Key themes included: 
    – Our new PERC strategy (Promote, Enable, Respond, Change) and how it is being delivered in practice  
    – The importance of partnerships across government, industry and international allies  
    – The opportunities and risks presented by technological change  

    Discussions reinforced that sanctions are most effective when delivered collectively, through strong coordination, clear implementation and ongoing engagement.

    OFSI published the following blog post about the event:

    Marking 10 years of OFSI: partnership, progress and the future of financial sanctions 

    Lindsey Whyte, Director General for International at HM Treasury, delivering remarks at OFSI10. Picture by Simon Walker / HM Treasury

    What does a decade of UK Financial Sanctions look like in practice? At the end of April, to mark its 10th anniversary, OFSI hosted an international conference on sanctions, bringing together partners and stakeholders from across UK government, industry and international allies including the EU, US, Ukraine, Australia, Japan, Canada and the Cayman Islands. 

    The conference demonstrated OFSI’s ability to convene a cross-sector group of partners, and, as many attendees noted, this created a more distinct forum than is typical. By bringing these partners together in one forum, OFSI had the unique opportunity to set out its new strategy openly, to support practical discussions on the shared challenges facing the sanctions community and pointing towards a clear pathway to strategically address these.  

    In her address, Lucy Rigby MP, Economic Secretary to the Treasury and OFSI’s lead Minister, emphasised that sanctions are not just about imposing restrictions, they also protect the integrity of the UK’s financial system and help ensure legitimate businesses are not undercut by illicit actors. Describing financial sanctions as an integral part of the UK economy, she underlined their role in supporting national resilience and maintaining the UK’s global reputation. She also pointed to a more complex geopolitical landscape, with links between developments in Russia and the Middle East, and the need to maintain sustained pressure on Russia for its illegal war in Ukraine, while managing wider risks to the global economy. She highlighted the importance of making better use of data and continuing to work collectively as threats evolve. 

    This direction was echoed by Lindsey Whyte, HM Treasury’s Director General International, and Permanent Secretary James Bowler, who both reflected on the strain on the international order and the central role sanctions now play, which require strong partnerships across government and with industry nationally and internationally.  

    The evolution and importance of the UK sanctions regime   

    Over the course of the day, panels explored how the UK’s sanctions framework has evolved and where it goes next. The first session, moderated by OFSI Deputy Director Daniel Drake, reflected on the shift from operating through the EU to delivering an autonomous UK framework. This capability was tested at pace in February 2022, when more sanctions were introduced in a few months than in the previous decade, driving significant change across government and industry. 

    As Daniel noted, OFSI is now “entering its teenage years” with stronger capabilities, deeper partnerships, and a clear role in delivering national security outcomes. 

    Across industry and international perspectives, what came through clearly was how much the system has matured. Firms described a shift from basic screening to highly sophisticated, proactive approaches, while international partners highlighted the UK’s credibility across implementation and enforcement. At the same time, the landscape continues to change, with increasing legal complexity, more sophisticated evasion tactics and ongoing pressure to strengthen capability and technology.

    Picture by Simon Walker / HM Treasury

    The Industry Perspective 

    The industry panel, moderated by OFSI Deputy Director Beth Davies, offered a candid view of how sanctions are applied in practice. Panellists highlighted the scale of investment firms have made in building sanctions capability, alongside the challenge of operating in a changing environment, where certainty is not always clear-cut and professional judgement is often required. Visible enforcement is seen as critical in shaping behaviour, while continued dialogue between government and industry remains essential, particularly in managing overcompliance and ensuring policy intent is understood. 

    Partnerships at the core of sanctions delivery 

    The penultimate panel, moderated by OFSI Director Giles Thomson, highlighted the importance of international partnerships for the effectiveness of sanctions. Speakers from the US, EU and Cayman Islands were clear that sanctions are most effective when applied collectively. Alignment across jurisdictions increases impact, whilst practical cooperation through intelligence sharing and regular engagement underpins delivery. Maintaining this alignment requires constant effort, particularly as new challenges emerge, including dynamic evasion techniques and the growing use of crypto assets. 

    Looking ahead: the next decade of sanctions 

    The final panel looked ahead to the future. Speakers focused on how technology will shape the future of sanctions. Advances in artificial intelligence and data are creating new opportunities to strengthen analysis, coordination and decision-making. However, panellists noted the need to be accountable for using these tools carefully, ensuring speed and scale does not come at the expense of sound human judgement.  The discussion highlighted a more complex operating environment, where sanctions, anti-money laundering and fraud are increasingly interconnected. The conclusion was clear: rapid technological change will demand that the system modernises ways of working to keep ahead of circumvention and evasion, and to take full advantage of new capabilities to deliver greater impact, without losing the role of human judgement.

    How OFSI delivers: PERC in action 

    A consistent thread running through the day was how the four pillars of OFSI’s new strategy –  Promote, Enable, Respond and Change (PERC) – are being delivered in practice.  

    The licensing spotlight highlighted the importance of enabling legitimate activity whilst maintaining pressure on designated targets, supported by clearer guidance, targeted use of General Licences and a structured prioritisation approach. The enforcement session reinforced the value of visible action in driving compliance, with more targeted investigations and increased publication of outcomes helping to shape behaviour across the system. 

    Feedback since the event has reinforced the value of bringing together such a broad mix of partners, allowing for what many commented felt like a different kind of conference. The range of perspectives and experience ensured meaningful, open, practical discussions about shared challenges and the future of sanctions throughout the day. 

    Closing the conference, Director Giles Thomson reflected on both progress across the decade, and the importance of maintaining momentum: “Financial sanctions are, at their core, a collective endeavour. They are only as strong as the system that implements them, and that system only functions because of the people within it. “

    The pace of change since 2022 has been significant, but the foundations now in place leave the UK well positioned for the future. Ultimately, the day reinforced a simple point: sanctions are not delivered by any one organisation alone. Their effectiveness depends on the collective efforts of government, industry and international partners and it is that shared effort which will define the next decade as much as the last. 

    To learn more about OFSI’s strategy and our Promote, Enable, Respond and Change (PERC) framework, read the full document here: OFSI Strategy: 2026 – 2029 – GOV.UK 

    —

    ,