The UK parliament is looking at ways to harmonise legislation and penalties for breaches of financial sanctions in its proposed Policing and Crime Bill 2016.

The bill also contemplates the introduction of temporary regulations for the prompt implementation of UN financial sanctions.

Sanctions disparities

Trade sanctions in the UK are administered by the Department of Business and Skills whereas financial sanctions are administered and implemented by HM Treasury and at present, there is a patchwork of legislation that sets out the penalties that can be imposed for breaches of sanctions.

Breaches of trade sanctions, for instance, carry a maximum sentence of ten years’ imprisonment, breaches of domestic terrorist asset freezes can attract a seven-year sentence while breaches of European sanctions are limited to a maximum penalty of just two years’ imprisonment.

The new bill would increase the maximum sentence for breaches of European sanctions to seven years.

UN financial sanctions

It currently takes the UK more than four weeks (via EU regulations) to implement UN financial sanctions whereas the Financial Action Task Force has indicated that international best practice would be to implement such resolutions within 48 hours to avoid asset flight.

The new bill would confer powers on HM Treasury to introduce temporary regulations to bridge this delay.

Categories: Trade Based Financial crimes News