OFSI has reminded firms that it now has power to impose penalties for breaches of financial sanctions, and says it will normally publish details of cases where it imposes them. It has also published guidance on its approach to compliance and enforcement, and on how it will assess whether to impose a monetary penalty, and the amount of that penalty. It notes it is required only to meet the “balance of probabilities” standard of proof, which will sometimes be based on whether an honest and reasonable person should have inferred knowledge or formed a suspicion of a breach of a sanctions prohibition. It notes that ignorance of the law is no defence. The guidance also notes that OFSI’s powers extend to breaches that have a UK nexus, although it says it will not try artificially to bring matters under UK jurisdiction.
The guidance notes many other relevant factors, and also notes that sometimes OFSI may decide to apply a penalty in the public interest even where a prosecution may appear to be warranted. When imposing a penalty, this will be clearly and consistently related to OFSI’s view of the impact of the case and value of the breach. Voluntary disclosure may be a mitigating factor and my reduce the amount of the penalty.
The guidance sets out the procedure for firms to make representations, and for asking Treasury for a review of OFSI’s decision.