Markom Management Limited (“MML”), a UK-registered financial services firm, was recently fined by the UK Office of Financial Sanctions Implementation for an alleged breach of Russia sanctions imposed after the 2014 annexation of Crimea. OFSI reported that a £300,000 monetary penalty was imposed in connection with MML’s alleged role in paying £416,590.92 to a person who was subject to Russia sanctions at the time. According to OFSI, MML caused a payment to be made from another company’s bank account knowing that the recipient of that payment was a designated person – an action that reportedly occurred when the firm had an inadequate sanctions compliance program in place.
OFSI emphasized that this case demonstrates for industry firms of any size, the importance of having an adequate compliance program that protects them from exposure to sanctions risks; enables them to promptly identify and report suspected breaches to OFSI; and alerts them to the risks associated with payments made in haste.