HMT consultation response on reforms to OFSI civil enforcement processes

HM Treasury (HMT) has published a consultation response and blog on proposed reforms to the UK Office of Financial Sanctions Implementation's (OFSI) civil enforcement processes. The reforms aim to increase efficiency in resolving enforcement cases and would apply solely to OFSI's civil enforcement powers concerning financial sanctions breaches, including Russia-related designated person asset reporting. They do not apply to criminal enforcement or non-financial sanctions. Following feedback to its July 2025 consultation, the OFSI confirms it will proceed with all proposals but with the following improvements:

• Additional case assessment guidance, including a new case assessment matrix and a Voluntary Disclosure and Co‑operation discount of up to 30% of the baseline penalty.
• 20% baseline penalty discount for subjects who settle under the new settlement scheme.
• Under the new Early Account Scheme (EAS), subjects will receive a return of an EAS discount of up to 20% where enforcement follows.
• Doubling of the maximum financial penalty to be imposed for a breach of financial sanctions, from the greater of GBP1million or half of the total value of the breach to the greater of GBP2m or the total value of the breach. This will be the first increase since the cap's introduction in 2017.

The proposed changes will take effect when OFSI publishes its updated Enforcement and Monetary Penalties guidance in February, except for the statutory maximum penalty increase. This will be implemented via legislation when parliamentary time allows. HMT will host a webinar once businesses have had time to review the consultation outcome and the forthcoming updated guidance.

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