UK Introduces New Monetary and Criminal Penalties for Breach of Financial Sanctions
The new Policing and Crime Act 2017 (the Act), which comes into force in April 2017, provides HM Treasury with enforcement powers to punish breaches of financial sanctions. Under the Policing and Crime Act 2017, HM Treasury has the power to impose monetary penalties if it is satisfied that a person acted in breach of sanctions and knew or had reasonable cause to suspect they were in breach, on the balance of probabilities. Part 8 of the Policing and Crime Act 2017 that deals with financial sanctions comes into force on 1 April 2017.
In summary: (1) for breaches of UK, EU and UN financial sanctions the maximum monetary penalty is £1,000,000 or 50% of the estimated value of the funds or economic resources, whichever is greater. In certain circumstances, HM Treasury may also impose a penalty in instances where there is a failure to provide information which has been specifically requested by HM Treasury; and (2) the Policing and Crime Act 2017 increases the maximum criminal penalty for breaches of financial sanctions from two to seven years’ imprisonment and includes breaches of financial sanctions in the list of offences to which Deferred Prosecution Agreements and Serious Crime Prevention Orders apply.