OFSI highlights key compliance lessons from first information request penalty
The UK’s Office of Financial Sanctions Implementation has published a blog outlining key compliance lessons for businesses following its first-ever fine imposed on a company for failing to respond to an official Request for Information (‘RFI’).
The guidance emphasises four key compliance takeaways from OFSI’s recent £5,000 penalty against Svarog Shipping & Trading Company Limited for failing to respond to the mandatory RFI during a Russia sanctions investigation.
‘This case signals to industry the importance of responding to RFIs in a timely and comprehensive manner; doing so helps contribute to the effective implementation and robust enforcement of financial sanctions,’ OFSI stated in the blog post.
The guidance also highlights the need for firms to recognise the seriousness of failing to comply with information requests, noting that Svarog’s inaction delayed the broader investigation and diverted OFSI’s resources.
OFSI advises firms to engage proactively with the regulator when receiving information requests, stating: ‘If firms receive an RFI from OFSI but are unsure how to respond, or believe they cannot meet the deadline, they should contact OFSI as soon as possible to seek clarification and/or request an extension. They should not ignore the request.’
The guidance specifically underscores the importance of having effective communication and monitoring systems in place to promptly identify and respond to regulatory inquiries, with OFSI noting that companies in high-risk sectors like maritime trade involving sanctioned entities should be particularly vigilant.
The penalty, issued on April 11, was levied after Svarog failed to meet a January 2024 deadline for responding to an RFI related to a complex Russia sanctions investigation and then failed to provide a reasonable excuse for the delay.
While OFSI ultimately concluded that Svarog had not committed any substantive sanctions violations, the agency emphasised that non-compliance with information requests is a serious breach.
