The first fine issued by OFSI is on UK-registered Svarog Shipping & Trading Company Limited.

The Office of Financial Sanctions Implementation (OFSI) has today announced it has issued a monetary penalty for breaches of the Russia financial sanctions regime linked to Russia’s illegal invasion of Ukraine in 2022.

On 11 April 2025, OFSI imposed a monetary penalty of £5,000 on the UK-registered company Svarog Shipping & Trading Company Limited (“Svarog”). 

This penalty relates to an information offence and is the first to be issued by OFSI.

• Svarog failed to respond within the timeframe to a statutory Request for Information (RFI) made by OFSI and
• Could not provide a reasonable excuse.

In those circumstances, OFSI can impose a penalty for the information offence. 

This case highlights the importance of firms and individuals responding promptly to OFSI RFIs.

Below, the OFSI has provided an overview of RFIs, a case summary, and the key compliance lessons the industry can learn.  

What do the OFSI mean by a “Request for Information?”

1. OFSI has legal powers to require certain firms and individuals to provide information.
2. The reasons OFSI might request this information are outlined in section 5.6 of OFSI’s general guidance.
3. These can include establishing whether financial sanctions may have been breached or monitoring compliance with specific financial sanctions regulations or licences. 
4. When requesting information, OFSI will specify the legislative basis for the request and the period within which the information will be provided. 
5. OFSI’s powers to request information are among the most important tools it has for investigating suspected breaches of financial sanctions.
6. Firms or individuals failing to respond to these requests can hinder OFSI’s timely access to information, impacting OFSI’s overall effectiveness and efficiency. 

What was the information offence committed by Svarog?

1. OFSI issued an RFI to Svarog on 26 January 2024, as part of a large and complex investigation.
2. Svarog did not respond to the RFI by the deadline. Despite OFSI sending reminders, Svarog’s response was only received after OFSI contacted Svarog’s auditors.
3. Svarog apologised for failing to respond to the RFI, but it did not provide a reasonable excuse for missing the statutory deadline.
4. Given Svarog’s failure to respond to OFSI’s RFI issued on 26 January 2024 and its failure to provide a reasonable excuse, OFSI concluded that Svarog had committed an information offence and that a penalty of £5,000 was the appropriate outcome.
5. OFSI ultimately concluded that Svarog had not breached financial sanctions other than concerning this information offence. 

For the full case details, please look at the penalty notice.  https://assets.publishing.service.gov.uk/media/681c69ff3f1c73824ee3e56e/Publication_Notice_-_Svarog.pdf

What are the key compliance lessons for industry?

1. Firms should recognise the seriousness of failing to respond promptly to RFIs.

1. OFSI takes a dim view of firms that delay or fail to respond to statutory obligations placed upon them.
2. Firms should, therefore, note the importance OFSI attaches to their information-gathering powers and be aware of the potential consequences of inaction.
3. Failure to respond to RFIs can significantly impede OFSI’s ability to assess compliance, enforce financial sanctions, and maintain compliance with sanction regimes. 
4. In this instance, Svarog’s failure to respond by the deadline delayed the broader investigation the RFI was related to and wasted OFSI’s resources, including the need for OFSI to contact Svarog’s auditor.
5. Such delays, if repeated across OFSI’s other enquiries, could seriously undermine OFSI’s effectiveness and efficiency, diverting resources away from enforcement action and constituting a poor use of taxpayer money. 

2. Engage proactively and candidly with OFSI when it comes to RFIs.

1. If firms receive an RFI from OFSI but are unsure how to respond or believe they cannot meet the deadline, they should contact OFSI as soon as possible to seek clarification and/or request an extension.
2. They should not ignore the request. If a firm believes it has missed a statutory deadline but has a reasonable excuse, it may be able to request an extension. In that case, it should proactively provide that excuse for OFSI to consider, accompanied by a full explanation of the circumstances.
3. Firms are encouraged to engage with OFSI’s published guidance and seek professional advice on their sanctions obligations if necessary.

3. Have effective communication and monitoring systems in place.

1. OFSI expects firms to have effective communication and monitoring systems to promptly identify and respond to any RFI they might receive from OFSI.
2. This includes appointing responsible personnel and monitoring and maintaining up-to-date contact information to ensure compliance with OFSI requests for information. 
3. This is especially true for firms operating in sectors with elevated exposure to sanctions. Svarog, which operates in the high-risk maritime oil shipment sector, demonstrated some awareness of sanctions risks and its exposure.
4. These factors ought to have made Svarog more vigilant of the request from OFSI and should have caused it to have robust processes in place for responding. 

4. Consider other compliance and reporting obligations.

1. Whilst the penalty in this case related to the failure to respond to an RFI without a reasonable excuse, other types of failures to provide information can also constitute breaches leading to penalties.
2. For example:
1. Non-compliance with reporting obligations, including failure to report and late reporting without a reasonable excuse. 
2. Incomplete or otherwise non-compliant reporting on specific and general licences, reporting requirements on licences, and failures to report frozen assets. 
3. You should ensure you know about your obligations as a relevant firm (as defined in the regulations), or as the user or holder of a valid OFSI licence. The requirement to comply with all other obligations applies to individuals and entities.

Conclusion 

• The information powers in the Russia Regulations are designed to ensure OFSI has prompt and full access to the information it needs to implement and enforce financial sanctions.
• This case signals to the industry the importance of responding to RFIs promptly and comprehensively; doing so helps contribute to the effective implementation and robust enforcement of financial sanctions.

Sources

Read more in the OFSI accompanying blog post: https://lnkd.in/eeDgNWN9 / https://ofsi.blog.gov.uk/2025/05/08/svarog-penalty-a-lesson-in-information-offences/

https://assets.publishing.service.gov.uk/media/681c69ff3f1c73824ee3e56e/Publication_Notice_-_Svarog.pdf