OFSI Fines Colorcon Limited £152,750 for Russia Sanctions Breaches

The Office of Financial Sanctions Implementation (OFSI), part of HM Treasury, has imposed a monetary penalty of £152,750 on Colorcon Limited for breaching the UK’s Russia sanctions regime. The penalty, issued on 10 September 2025, relates to payments made by the pharmaceutical supplier’s Moscow office to employees and service providers through Russian banks subject to financial restrictions.

Between March and December 2022, Colorcon authorised 123 payments with a total value of £191,290.57 through designated entities including Alfa Bank, Promsvyazbank, Sberbank and VTB Bank. OFSI concluded that £128,277.72 of these transactions were in breach of UK financial sanctions. Some payments were temporarily permitted under a general licence designed to allow companies to wind down their Russian operations, but Colorcon failed to comply with the associated reporting requirements, which was treated as an aggravating factor.

OFSI assessed the case as “serious”, noting that Colorcon had significant exposure to sanctions risk due to its long-standing operations in Russia. The regulator highlighted weaknesses in the company’s sanctions compliance framework, including reliance on assumptions about its bank’s screening processes, and insufficient monitoring of payments to employees and service providers. OFSI also pointed to a four-month delay between Colorcon identifying potential breaches and notifying the authority, reducing the level of discount applied to the fine.

While Colorcon cooperated with the investigation and ultimately disclosed the breaches, OFSI emphasised that voluntary disclosure must be both complete and prompt. The company received a 35 per cent reduction in its penalty, below the maximum 50 per cent discount available for timely reporting. Without this discount, the fine would have totalled £235,000.

This case underscores the UK Government’s message that sanctions compliance is a legal duty for all UK persons and entities, wherever they operate. OFSI stressed that businesses cannot rely solely on third parties, such as banks, to ensure compliance and must regularly review and update sanctions policies to reflect the evolving geopolitical landscape.

The enforcement action against Colorcon Limited serves as a warning to firms with international operations that breaches of UK financial sanctions will be met with robust penalties. Companies are reminded of their obligations to freeze, report, and avoid making funds available to designated persons, and to seek licences where exemptions apply.

Read the penalty notice here.