UK: Monetary penalties for breaches of financial sanctions
(S) Download case studies and documentation as regards monetary penalties for breaches of financial sanctions.
Financial sanctions are an important part of foreign policy, and support national security. They help to maintain the integrity of and confidence in the UK financial services sector.
Generally, they are imposed in order to:
coerce a target's ability to carry out unacceptable behaviour by increasing the cost
on them to such an extent that they decide to seize the unacceptable behaviour to constrain a target by trying to deny them access to key resources needed to
continue their unacceptable behaviour, including the financing of terrorism or nuclear proliferation
signal disapproval of a target as a way of stigmatising and potentially isolating them, or as a way of sending broader political messages to international or domestic constituencies.
Monetary Penalty
The powers to impose a monetary penalty, and the limits on the level of penalty, are created by s.146 of the 2017 Act
Power to impose monetary penalties
(1) The Treasury may impose a monetary penalty on a person if it is satisfied, on the
balance of probabilities, that-
(a) the person has breached a prohibition, or failed to comply with an obligation,
that is imposed by or under financial sanctions legislation,
and
(b) the person knew, or had reasonable cause to suspect, that the person was in
breach of the prohibition or (as the case may be) had failed to comply with the
obligation.
(2) The amount of the penalty is to be such amount as the Treasury may determine but it may not exceed the permitted maximum.
(3) In a case where the breach or failure relates to particular funds or economic resources and it is possible to estimate the value of the funds or economic resources, the permitted maximum is the greater of-
(a) £1,000,000, and
(b) 50% of the estimated value of the funds or resources.
(4) In any other case, the permitted maximum is £1,000,000
Criminal Prosecution of up to 7 years
The 2017 Act also increased the maximum sentence for criminal prosecutions from 2 to 7 years' imprisonment and brings financial sanctions into the scope of Deferred Prosecution Agreements and Serious Crime Prevention Orders.
Case Study
Telia Carrier UK Limited Telecommunications
Council Regulations (EU) No 36/2012 enforced by the Syria (European Union Financial Sanctions) Regulations 2012 (S.I. 2012 No 129)
Making economic resources available to a designated person, without a licence
Telia_monetary_penalty
.pdf
Download PDF • 1.51MB
Case Study
Standard Chartered Bank
EU Council Regulation 833/2014, Ukraine (European Union Financial Sanctions) (No.3) Regulations 2014
Making funds available to a designated person, without a licence
200331_-_SCB_Penalty_Report
.pdf
Download PDF • 102KB
Monetary penalties for breaches of financial sanctions - Guidance Document
Monetary_Penalties_Guidance__Jan_2022_
.pdf
Download PDF • 641KB