OFSI fines for sanctions breach

OFSI has published details of a monetary penalty imposed on Hong Kong International Wine and Spirits Competition Ltd. The fine, of £30,000 related to 3 payments and 78 wine bottles the company had received from a Designated Entity under the Ukraine sanctions originally imposed in 2014. The breaches occurred in relation to competitions between September 2017 and August 2020. After receiving a suspected breach report in late 2020 from a third party, OFSI used its information powers to get further information from the comapny, as a result of which it identified 5 separate breaches – 4 of them relating to receipt of funds or wine bottles, and one relating to the publicity made available to the Designated Entity. OFSI considered the publicity relevant as it would be likely to be exchanged for funds on the basis the Designated Entity would use it to increase their wine sales.

The tangible value received was just under £4,000 but the company also made publicity available to the Designated Entity, which OFSI considers an intangible economic resource.

The fine was imposed under the terms of s146 Policing and Crime Act 2017 applicable at the time.

OFSI did not apply any discount because the company did not report any of the breaches, but said it did fully cooperate with its investigations.  The company also exercised its right to Ministerial Review of OFSI’s decision, but the review confirmed the decision to fine and the amount of it.

Emma Radmore