HM Treasury has published the Office of Financial Sanctions Implementation’s (OFSI) response on reforming its civil enforcement processes for financial sanctions, including the Oil Price Cap, confirming it will take forward the full package of proposals consulted on. The reforms cover case assessment transparency, changes to penalty discounts, new settlement and “early account” options, streamlined penalties for certain procedural breaches, and an increase in statutory maximum penalties. OFSI will publish a new case assessment matrix and replace the voluntary self-disclosure discount with a Voluntary Disclosure and Co-operation discount capped at 30%. A settlement scheme will be introduced for monetary penalty cases with a 20% discount applied to the baseline penalty amount and conducted through a time-limited process, with subjects required to waive rights to ministerial review and judicial appeal and to agree not to contest OFSI’s findings; OFSI will also consider cases involving circumvention on a case-by-case basis. An Early Account Scheme will allow subjects, in appropriate cases, to provide a comprehensive early factual account in return for a separate discount of up to 20% (whether or not the case is later settled), and OFSI will apply applicable discounts concurrently to the same baseline penalty. For information, reporting and licensing offences, OFSI will introduce fixed monetary penalties in guidance set at GBP 5,000 or GBP 10,000, with a 15 business day representations period and publication of outcomes, while retaining discretion to use other outcomes or impose different penalties where warranted. Most measures are intended to be implemented shortly through forthcoming public guidance. The proposed increase in statutory maximum penalties from the higher of GBP 1 million and 50% of breach value to the higher of GBP 2 million and 100% of breach value will require legislative change and will not take effect until legislation is passed.
HM Treasury 2026-01-29
HM Treasury confirms OFSI enforcement reforms and plans to raise maximum civil sanctions penalties to GBP 2 million or 100% of breach value
HM Treasury announced reforms to the Office of Financial Sanctions Implementation's civil enforcement processes, including increased transparency, revised penalty discounts, and new settlement options. Key changes include a Voluntary Disclosure and Co-operation discount capped at 30%, a settlement scheme with a 20% discount, and fixed penalties for certain offences. Statutory maximum penalties will rise, pending legislative approval, from the higher of GBP 1 million and 50% of breach value to GBP 2 million and 100% of breach value.