OFSI issues £152,750 penalty on Colorcon for Russia sanctions breaches
The Office of Financial Sanctions Implementation (OFSI) has issued a penalty of £152,750 on Colorcon Limited, a pharmaceutical industry supplier and UK-registered subsidiary of Colorcon Inc., for breaching the Russia (Sanctions) (EU Exit) Regulations 2019. The breach involved 79 payments totalling £128,277.72 made by Colorcon’s Moscow office to accounts held at designated Russian financial institutions, in contravention of the UK financial sanctions linked to Russia’s illegal invasion of Ukraine in 2022. Although 44 of the payments were covered under General Licence INT/2022/2055384 prior to its expiry, Colorcon failed to comply with its reporting obligations and continued transactions after the licence had expired. OFSI assessed the case as serious, citing inadequate internal controls, delayed disclosure, and reliance on third-party screening without verification. A 35% discount was applied to the penalty due to voluntary disclosure, reduced from the maximum 50% because of a four-month delay in reporting. This case highlights key compliance lessons for the industry, notably that reliance on third parties does not absolve responsibility; the party committing the breach will be held accountable.