Extended enforcement powers and updated guidance on financial sanctions

Thu 10 Aug 2017
Posted by: IOE&IT News
Trade News

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From 8th August, the Government has extended powers to act against those who don’t report information required under financial sanctions legislation.

All businesses, organisations and individuals have an obligation to report information which facilitates compliance with the regulations. However, enforcement action could only be taken against firms or people in the regulated financial services sector who failed to report.

The extended powers, set out in new regulations, broaden enforcement to the following business areas from 8 August 2017:

  • auditors
  • casinos
  • dealers in precious metals or stones
  • estate agents
  • external accountants
  • independent legal professionals
  • tax advisors and
  • trust or company service providers

Prompt reporting of information is essential for financial sanctions to be an effective foreign policy and national security tool. For instance, it helps OFSI to detect breaches and identify those who evade sanctions by using different aliases.

The new regulations extend existing powers without creating new ones or changing the purpose of the law. The only change is that from 8 August these groups may commit a criminal offence if they do not report the information they should already be reporting to OFSI.

OFSI have updated their Guide to Financial Sanctions to help individuals and businesses understand what they should report and when. All impacted businesses are encouraged to review their responsibilities as non-compliance could lead to a monetary penalty or criminal prosecution.

As well as new information on reporting obligations, the updated guide clarifies OFSI’s existing positions on organisations owned or controlled by those subject to financial sanctions, as well as the process for obtaining a licence.

OFSI will continue to work with industry bodies to develop its guidance so that it is responsive to what businesses, and the public and charitable sectors, need.

OFSI’s guidance is published on GOV.UK: