Context
The OFSI has imposed a £160,000 monetary penalty on Bank of Scotland Plc (part of Lloyds Banking Group), for breaching the Russia financial sanctions regime. Between 8 and 24 February 2023, the bank processed 24 payments totalling £77,383.39 to and from a personal current account held by a UK‑designated person. OFSI concluded that the bank breached prohibitions on dealing with, and making funds available to, a designated person.
Key points to note and next actions
The case highlights several important lessons for firms to:
- Ensure that sanctions screening tools are sufficiently enriched with relevant information to optimise their capabilities. Firms with greater sanctions risk exposure may benefit from commercial packages, such as commercial sanctions lists to enrich their sanctions screening.
- Address the inherent risks of automated screening with robust contingency procedures and clear escalation routes, particularly in higher‑risk areas such as those involving Politically Exposed Persons.
- Keep sanctions training under regular review, so that its content accurately reflects relevant regulatory and geopolitical developments.
- Consider prompt, voluntary disclosure of potential breaches. OFSI seeks to reward prompt and complete voluntary disclosures through penalty discounts.