What Does the OFSI Annual Review 2024–25 Reveal About the UK’s Sanctions Strategy?

The Office of Financial Sanctions Implementation (OFSI) has released its Annual Review 2024–25, which disclosed new sanctions designations and the state of sanctions enforcement within the UK. This year’s focus isn’t just on imposing sanctions but on ensuring that they are effective enough, strictly enforced, and properly understood across sectors.

OFSI annual review explains how the UK is balancing strong enforcement with industry cooperation, broadening guidance to new sectors. It has also presented how the UK has deepened cooperation with its international partners like the EU, and intensified its intelligence-led compliance approach.

The report also highlights OFSI’s growing internal capability, including expanded staffing, new analytical systems, and a focus on digital transformation. These efforts aim to manage the increasing volume of sanctions cases and data more effectively.

What are the key highlights of the Annual Review Report?

In 2024–2025, OFSI focused on three priorities: effective compliance, capability, and enforcement. These three pillars underpinned its mission toward the continued improvement of the UK financial sanctions regime and consistency in the implementation of asset freeze sanctions.

During the year, frozen assets maintained their level at 37 billion euros, with 4,733 references appearing on the UK OFSI Consolidated List. In contrast, the licensing activity increased considerably: 19 general and 904 specific decisions were made. The authority in charge of sanctions reinforced international cooperation by means of 210 interactions across 44 jurisdictions and a new MoU with the U.S. sanctions watchdog OFAC.

Regulatory reforms extended the definition of “relevant firms” and increased the powers of the UK sanctions authority, reflecting its broader remit and stronger enforcement capacity.

How has OFSI strengthened the UK’s sanctions regime this year?

OFSI worked on simplifying the UK’s sanctions regime to make it more efficient, transparent, and responsive. The authority worked closely with HM Treasury and other government bodies. The sanctions authority even improved legal certainty and streamlined response times throughout its activities.

Some of the key enhancements include streamlining licensing procedures, automating internalizing reviews, and increasing cooperation between enforcement groups and intelligence agencies. These actions enhanced UK sanctions implementation, monitoring, and coordination with the financial community as well as the general public.

On the operational side, the UK sanctions watchdog enhanced its intelligence function so it could more effectively detect circumvention and non–self-reported violations, especially in high-risk areas like crypto-assets, legal, maritime, and art dealers.

Legislatively, the 2024 Sanctions Regulations broadened the powers of OFSI by introducing a new licensing basis for insolvency services. They also added reporting obligations for new types of firms.

The Economic Deterrence Initiative (EDI) also saw OFSI spend on data management systems, licensing after-care, staff training (over 50 specialist training exercises), and more aggressive investigations. Collectively, these reforms show the move by sanctions authority toward a more contemporary, data-driven, and cooperative sanctions model.

How is OFSI working with international partners to enforce sanctions?

The annual review report highlights global coordination as a central aspect of its strategy to enhance the UK’s sanctions regime. Post-Brexit (SAMLA), the UK remains closely aligned with other leading global partners — specifically the United States, the European Union, and G7 allies — to maintain consistent and coordinated enforcement of sanctions.

Throughout the year, OFSI strengthened cross-border information exchange, helping to contribute to concerted action against sanctions evasion, asset concealment, and the financing of prohibited activities. It strengthened cooperation with the EU’s DG FISMA and other territories through quarterly exchanges, including work on initiatives like the Russian oil price cap.

One significant achievement was the signing of its first Memorandum of Understanding (MoU) with the U.S. Treasury’s Office of Foreign Assets Control (OFAC). The partnership improves exchange of intelligence and joint enforcement efforts.

OFSI  also extended outreach to the British Overseas Territories and Crown Dependencies, offering technical support to the likes of the British Virgin Islands and Cayman Islands. Together, these efforts serve to close jurisdictional loopholes, facilitate cross-border enforcement, and strengthen the UK’s position as an active and leading global sanctions power.

What steps has OFSI taken to ensure better compliance and enforcement?

Compliance is still at the core of the OFSI mission, and between 2024–2025 the office expanded its support for businesses via new guidance documents, webinars, and sector-specific outreach sessions to explain OFSI compliance requirements.

OFSI organized more than 30 outreach events, addressing key sectors like the financial services sector, legal community, cryptoassets, charities, and maritime, and publishing 159 e-alerts, blogs, and LinkedIn posts to update stakeholders. In terms of licensing, it made 904 decisions, which represented greater efficiency than the 1,401 made last year.

Enforcement activity also increased as OFSI took a proactive, intelligence-driven approach, with non-self-reported cases increasing to 151 from 108 in the previous year—demonstrating a more focused use of detection over voluntary reporting. The assignment of a Compliance Enforcement team added to the pace of action on license-reporting infractions and improved overall enforcement response times.

One such example was the £465,000 fine on Herbert Smith Freehills (HSF) LLP, where its Moscow office paid designated persons—highlighting that firms need to be aware of ownership and control structures and stick to sanctions policies strictly despite being short of time.

How has OFSI supported financial institutions and businesses?

The 2024-2025 OFSI Annual Review highlights the authority delivered over 30 outreach events, ranging from international conferences to sector-specific forums. It includes industry-specific guidance for sectors such as legal, financial, and maritime services.

It also published industry-specific advisories, including on North Korean IT workers and Russian oil origin manipulation, allowing companies to identify and manage emerging compliance risks.

Additionally, the combined e-alert service operated jointly with the Foreign, Commonwealth & Development Office (FCDO) and the Office of Trade Sanctions Implementation (OTSI). They expanded its reach to over 56,000 subscribers by April 2025. Collectively, these initiatives highlight OFSI’s strategic focus on promoting education, collaboration, and proactive compliance across regulated sectors.

What Are the OFSI’s Plans for 2026?

In the OFSI Annual Report 2025, the last few pages look ahead to 2026, its 10th anniversary since it was formed in 2016 under HM Treasury. The review states that the UK sanctions watchdog will use that anniversary to stop and reboot its long-term strategy so that the UK sanctions regime remains effective and forward-looking.

By 2026, OFSI aims to:

• Investing further in data analytics and intelligence systems so that monitoring and enforcement are more proactive.
• Deepening global coordination with the U.S., EU, and G7 partners;
• Broader compliance outreach to sectors such as crypto-assets, real estate, and the art market; and
• Strengthening its own brand as a world-class sanctions authority.

In other words, 2026 is a strategic turning point toward a more tech-enabled, intelligence-driven model of sanctions enforcement.