On 12 July 2022, the UK extended 'The Russia (Sanctions) (EU Exit) Regulations 2019' ‘the Regulations’. Professional firms need to ensure that they are familiar with the new measures.
Following Russia’s decision to invade Ukraine, the UK has increased the level of its economic sanctions against Russia. Sanctions under the Regulations have applied since Russia's invasion of Crimea in 2014.
The government has been updating the UK's sanctions since the start of the invasion of Ukraine.
12 July 2022: Financial Sanctions Notice two entries for named individuals on the UK Sanctions List have been updated and 16 entries have been amended and are still subject to an asset freeze.
Sanctions against Russia at a glance
Professional firms must keep up-to-date with the new regulations.
It is a criminal offence to contravene the trade, shipping and financial sanctions, as well as to enable or facilitate a contravention of, or to circumvent, any of the prohibitions in the Regulations.
- Part 8 of the Regulations places obligations on 'relevant firms', the definition of which includes those providing accountancy, legal, tax or trust services (other occupations are also included in the definition i.e. estate agents, money lenders etc, see part 8) to report information to HM Treasury about known or suspected designated persons or about persons who may have committed an offence under the Regulations.
- HM Treasury also has powers to request information and the Regulations establish offences for failing to comply with these requests (including for providing false information).
- Part 8 also establishes information powers and record-keeping responsibilities in relation to the trade sanctions contained in the Regulations. It provides for offences for failing to comply with any of those requirements or intentionally obstructing an officer in the exercise of those powers.
If you have obligations or responsibilities under Part 8 of the Regulations, it is important that you familiarise yourself with them. If you are unclear of your obligations or responsibilities, you are advised to seek independent legal advice.
If you find out that a person or organisation you are dealing with is subject to the financial sanctions detailed in the Regulations, you must immediately:
- Check whether you maintain any accounts or hold any funds or economic resources for the sanctioned persons: See
- Freeze such accounts and other funds or economic resources which are owned or controlled by persons set out in the Notice.
- Refrain from dealing with the funds or assets or making them available (directly or indirectly) to such persons unless licensed by the Office of Financial Sanctions Implementation (OFSI).
- Report any findings to the OFSI, together with any additional information that would facilitate compliance with the Regulations.
- Provide any information concerning the frozen assets of designated persons that the OFSI may request. Information reported to the OFSI may be passed on to other regulatory authorities or law enforcement.
- Inform OFSI as soon as possible by either emailing
The Consultative Committee of Accountancy Bodies (CCAB) has issued joint guidance for the profession on the situation in Ukraine.
- Their guidance reminds the profession of their ethical obligations in relation to compliance with sanctions regimes imposed by the UK Government and their statutory duties to report any instances of non-compliance with the sanctions regime of which they become aware.
- There is a heightened risk of money laundering as individuals and organisations may seek to evade the impact of the sanctions. The guidance reminds the profession of their duty to have in place adequate Anti Money Laundering (AML) procedures and to undertake adequate risk assessments and enhanced due diligence checks where required.
- See CCAB guidance on Russian sanctions
The Institute of Chartered Accountants in England and Wales (ICAEW) has provided guidance for accountants as follows:
- "Members in practice must check whether they hold any funds or economic resources for the persons set out in the current Annexe to the Financial Sanctions Notice.
- If such funds are held, members must freeze such funds or resources and any others that are owned or controlled by persons listed in the annexe to the Notice and must refrain from dealing with these assets or making them available (directly or indirectly) to persons listed unless licensed by OFSI to do so.
- Members must report any findings to OFSI and any information that would facilitate compliance with the sanctions and provide any information that OFSI may request. Failure to comply with the regulations or seeking to circumvent its provisions is a potential criminal offence.
- It is therefore important that members fully understand the assets under the ownership and control of their clients. Members are advised to check the latest Sanctions list and guidance published by HMT and OFSI regularly."
Michael Izza, ICAEW Chief Executive says:
“The UN Secretary-General has urged the president of Russia to halt his invasion of Ukraine and prevent ‘what could be the worst war since the start of the century’. The UK government, standing alongside the US and EU, has announced a further package of sanctions aimed at demonstrating to the Russian elite the political and financial costs of their aggression.
ICAEW is confident that chartered accountants, whether in practice or in business, will be ready and willing to play the fullest possible role in making these measures effective, and in helping companies across the economy cope with the disruption they will bring.”
The Chartered Institute of Taxation (CIOT) has provided additional guidance for tax advisers, noting as follows:
- Firms are required to adopt a risk-based approach for AML and should already have policies and procedures in place to assess risk and part of that process involves checking the sanctions lists where appropriate.
- CIOT recommend reviewing your client lists and Client Due Diligence (CDD) to assess if you have any risk exposure in relation to Russian sanctions, particularly where it is some time since the original CDD was undertaken. This will help you to determine if you need to check some, or all of your, clients for the recent and continuing sanction updates, and consider if any client risk assessments require adjusting. You may also need to review your practice-wide risk assessment to reflect any overall changes in the AML risk profile of your practice.
- Where you have concerns you should approach clients for further client due diligence or other information and should also consider reviewing electronic ID checks and doing open-source checks (for example via Google searches). You may need to do further checks on individual clients to ensure they are not sanctioned and details on how to do this are included in the next section.
- All AML supervised members can expect to receive further emails covering Russian Sanctions requirements and requesting information.
- In the meantime, if you are a CIOT supervised member who deals with Russian clients, UK clients with connections to Russia (such as Russian parent companies or suppliers), or other connections such as Russian staff, please email
Useful guides on this topic
AML: Checklist incorporating AML 5
This checklist incorporates the changes made by Anti-Money Laundering Directive 5. This is designed to be illustrative only and should give some insight into the changes you will need to make to your own systems in reviewing your existing clients.
AML: Anti-Money Laundering Procedures and Checks
A subscriber guide to Anti-Money Laundering (AML) procedures and checks, including what factors to consider when taking on a new client and conducting your 'know your client' procedures.
AML: Anti-Money Laundering Zone
Anti-Money Laundering (AML) Zone takes you to our supporting AML guides, checklists and articles.
Start here: Statutory Guidance on Russia Sanctions
Which legislation? The Russia (Sanctions) (EU exit) Regulations 2019
Which individuals and entities are targets: Financial sanctions targets: list of all asset freeze targets
Which new companies are targets: Russia: list of persons named in relation to financial and investment restrictions