Financial Services Threat Assessment Report published

The Office of Financial Sanctions Implementation has published a Threat Assessment Report covering Financial Services. The report identifies key evasion threats, red flags that businesses should be aware of, and recommendations on how to mitigate the identified risks.

This is the first in a line of Threat Assessment Reports produced by OFSI, as committed under the Economic Crime Plan 2.

Key Judgements

This assessment examines sanctions threats relevant to UK financial services firms from February 2022 to the present.

1. Some UK financial services firms, including non-bank payment service providers (NBPSPs), have likely not disclosed all suspected breaches to OFSI. The identification and reporting of suspected breaches vary across the sector and different UK sanctions regimes.

2. Most non-compliance by UK financial services firms has highly likely resulted from common issues such as improper maintenance of frozen assets and breaches of licence conditions. These issues affect compliance with all UK sanctions regimes.

3. Russian designated persons (DPs) have almost certainly sought new professional and non-professional enablers to help them bypass UK financial sanctions. Enabler activity has increased significantly since 2023.

4. Enablers have highly likely made payments through NBPSPs to support Russian DPs' lifestyles and assets, including superyachts and UK residential properties.

5. A small number of enablers have likely attempted to front for Russian DPs and claim ownership of frozen assets.

6. Enablers have almost certainly used alternative payment methods, particularly cryptoassets, to evade UK financial sanctions on Russia.

Read the full report here