The Law Society has made an urgent plea to solicitors to participate in this year's frozen asset reporting exercise.
As part of this review, the Treasury requires all persons that hold or control funds or economic resources belonging to a designated person, to complete the reporting form and submit it to the Office of Financial Sanctions Implementation (OFSI) by Friday 11 October 2019.
Firms should note that EU Regulations are frequently revised and updated. Recent changes include the amendment of financial sanctions against Venezuela in July and September to apply an asset freeze to further listed persons.
The Treasury has provided an example of what the Annual Review involves.
In the first place, firms should identify all of the funds or economic resources belonging to, owned, held or controlled by designated persons that are held or controlled by the firm. The firm should report all identifying information concerning those funds or economic resources, along with their value as at 30 September 2019, to OFSI.
Secondly, firms are required on an ongoing basis to:
1. check whether you hold or control any funds or economic resources belonging to, owned, held, or controlled by the persons listed on the Treasury’s Consolidated List of asset freeze targets;
2. if yes to (i) above, freeze such funds or economic resources;
3. refrain from dealing with the funds or economic resources or making the funds or economic resources available to, or for the benefit of, such persons unless licensed by OFSI;
4. report any findings to OFSI, together with any additional information that would facilitate compliance with the legislation; and
5. provide any information concerning the frozen funds or economic resources of designated persons that OFSI may request. Information reported to OFSI may be passed on to other regulatory authorities or law enforcement.
Firms are reminded that in respect of assets frozen by financial sanctions it is generally prohibited to:
- Deal with the frozen funds or economic resources, belonging to or owned, held or controlled by a designated person;
- Make funds or economic resources available, directly or indirectly, to, or for the benefit of, a designated person;
- Engage in actions that, directly or indirectly, circumvent the financial sanctions prohibition.
Failure to comply with financial sanctions legislation or seeking to circumvent its provisions is a criminal offence. Such conduct could lead to either a criminal conviction or civil or administrative action by OFSI. This might include the imposition of a monetary penalty of up to either £1 million or 50% of the monetary value of the breach, whichever is greater.
The consolidated list of designated persons and all asset freeze targets can be found here.
Juliet Oliver, SRA General Counsel, said: "Solicitors are rightly being asked to make sure they are not helping anyone with dubious funding streams. This risk exists for every single solicitor and law firm, whether conveyancing on the high street or handling global transactions. "We would urge all of you to look at the review and, if a client is listed and you hold any of their assets, make a report as necessary."