OFSI Annual Review 2023-2024: A Shift Towards Proactive Sanctions Enforcement and Enhanced Industry Engagement

On 21 March 2025, the Office of Financial Sanctions Implementation (OFSI) published its annual review for 2023-2024 period. The report highlights a number of key developments in the agency’s work. Importantly, the data provided does appear to indicate that OFSI is (finally) looking to become more proactive in enforcing violations of UK sanctions (which, to date, has been an area where OFSI has been the subject of routine scrutiny). 

In its report, OFSI emphasises the following themes from its 2023-2024 initiatives: 

Engage

• In an aim to make the sanctions regime more widely understood by the industry, OFSI has conducted 105 outreach engagements, in addition to bilateral meetings with various businesses. The regulator has stressed the importance of direct communication and transparency in improving sanctions compliance. OFSI also participated in 245 international engagements.
• OFSI has continuously provided e-alerts and written guidance, including through the Joint Money Laundering Intelligence Taskforce and its own e-alert service, with an aim to assist firms subject to the UK’s regime in improving their compliance policies. 

Enhance

• By end of March 2024, OFSI expanded the consolidated list of UK designated persons by adding a further 564 persons, taking the total number to 3,463 individuals and 15 ships subject to UK financial sanctions. 
• In order to effectively carry out its functions, OFSI made efforts to increase its staff resources, mainly across the licensing and enforcement divisions. Resource in OFSI’s licensing and enforcement teams increased fourfold; and its guidance and engagement function doubled in size.
• In order to mitigate the impact of sanctions, OFSI delivered a large number of licensing decisions, which rose to 1,401 cases, compared to just 503 in the previous reporting period. 

Enforce

• Following previous criticism for lack of proactive enforcement, OFSI issued its first civil monetary penalty in August 2024, and most recently issued another monetary penalty on 20 March 2025. and is expecting to publish details of further penalties in later reporting periods.
• The OFSI Enforcement team progressed a record number 396 cases in 2023-2024, with 242 cases being closed, which can be further broken down as follows:
  • 133 - No breach, no further action “NFA” letter
  • 18 - Breach, warning letter issued
  • 1 - Breach, warning letter and referral to regulator
  • 1 - Breach with public disclosure
  • 61 - No decision on breach, NFA letter
  • 28 - Other
• Of the 396 total cases, 288 were self-reported.  OFSI encourages everyone to self-report suspected breaches of financial sanctions. As set out in guidance, self-reporting is one of the factors that OFSI considers when determining what enforcement action is appropriate in cases where a breach is determined, and whether a discount should be applied to any monetary penalty imposed. 
• As of April 2024, OFSI had 208 cases allocated for investigation, which was a significant increase from the previous year; and states that it expects that a number of enforcement cases are due to be announced in 2025.
• Overall, OFSI has frozen £25 billion Russian assets since the beginning of the war in Ukraine. 

Key takeaways for business 

Whilst OFSI is still largely reliant on self-reporting by firms to identify breaches of sanctions, companies should take note of the potential increase in enforcement action as the regulator is looking to move to a “proactive, intelligence-led enforcement model ensuring it is leveraging its data, and its partners’ data, to identify breaches of sanctions”.  

It is important that companies continue to develop a robust and risk-based sanctions framework, leveraging the guidance and direct communication increasingly offered by OFSI to obtain as much clarity as possible on the regulator’s approach.

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