OFSI Consultation Proposes Streamlined Sanctions Enforcement & Settlement Schemes

The UK’s Office of Financial Sanctions Implementation (OFSI) has launched a significant consultation seeking stakeholder input on proposed reforms to its enforcement policies and processes. This move signals a shift towards greater efficiency, transparency and proportionality in how financial sanctions breaches are handled, with potentially far-reaching implications for regulated firms and individuals alike.

OFSI is considering several substantive changes, including:

• Amendments to case assessment guidance: Revisions to its public case assessment framework, with a clearer methodology for applying penalty discounts in cases involving voluntary disclosure and co-operation.

  
  

• A formal settlement scheme: This would allow parties to resolve monetary penalty cases more swiftly, mirroring established settlement approaches in other regulatory domains.

  
  

• An Early Account Scheme: Encouraging early, full disclosure from the subject of an investigation in return for procedural or penalty benefits.

  
  

• A streamlined route for lower-level cases: Including the potential for indicative penalties, to reduce the burden of prolonged enforcement proceedings.

  
  

• Adjustments to statutory penalty ceilings: Reviewing and potentially increasing the maximum penalties that can be applied under law.

  
  

These proposals suggest a more pragmatic and predictable enforcement model, designed to balance deterrence with fairness. The consultation also underscores OFSI’s intent to reduce the operational impact of enforcement on both the agency and the private sector, without compromising sanctions integrity.

Stakeholders are encouraged to provide feedback by 23:59 on 13 October 2025. Firms with exposure to UK financial sanctions, particularly those operating in high-risk jurisdictions or with complex supply chains, should review these proposals closely and consider their implications for internal reporting, voluntary disclosure strategies and legal risk management.

This consultation marks a pivotal moment in the evolution of the UK's financial sanctions regime. By aligning enforcement with best practice regulatory standards, OFSI is paving the way for more effective and accountable sanctions compliance across the UK economy.

Find out how to provide feedback here.