On 14 November 2024, the Sanctions (EU Exit) (Miscellaneous Amendments) (No.2) Regulations 2024 was laid in Parliament.
This instrument expands the definition of relevant firms subject to financial sanctions reporting obligations to cover insolvency practitioners (IPs). The Office of Financial Sanctions Implementation (OFSI) has published new guidance to support Insolvency Practitioners in meeting these new reporting obligations.
From 14 May 2025, IPs will be subject to the reporting obligations within these sanctions and will be required to report to OFSI as soon as practicable if they know or have reasonable cause to suspect that a person (i) is a designated person; or (ii) has committed a breach of financial sanctions regulations. Where the designated person is a customer* of the IP, the IP must also report to OFSI the nature and amount or quantity of any funds or economic resources held by them for the customer* at the time when it first had the knowledge or suspicion.
The guidance sets out the circumstances in which this reporting must be made and the information that must be reported.
*Note: The CCAB Supplementary Anti-money Laundering Guidance for Insolvency Practitioners section F.3.1 states that in the context of insolvency, there will always be a ‘business relationship’ between the IP and the debtor or entity over which they are appointed. Therefore, where the debtor/entity over which the IP is appointed is a designated person; the nature and amount or quantity of any funds or economic resources held by the IP should be reported to OFSI.