OFSI fines Citibank London 4.7 million pounds over Russia sanctions breaches

What happened

The UK Office of Financial Sanctions Implementation (OFSI) has fined Citibank, N.A., London Branch 4,732,830.58 pounds, roughly 4.7 million pounds and about $6.4 million, for breaching Russia sanctions. AML Intelligence broke the story on 2 September 2026, reporting on the underlying OFSI enforcement notice. Bloomberg and the KYC360 AML Roundup corroborated the figures on 4 September 2026.

OFSI found that the London branch processed 970 payments worth more than 19.7 million pounds for accounts that should have been restricted. The payments flowed to or through three designated Russian banks: Alfa-Bank JSC, PJSC Gazprombank, and Credit Bank of Moscow. OFSI states that most of the breaches happened between February and November 2022, in the months following Russia’s invasion of Ukraine.

OFSI issued a Notice of Intention on 15 June 2026, and the case settled on 11 August 2026. Citibank voluntarily disclosed most of the breaches. It received a 20% discount for that disclosure and a further 20% discount for cooperation during the investigation.

Why it matters

Analysis: this case shows OFSI enforcing firmly even against a bank that self-reported and cooperated throughout. A combined 40% discount still left a penalty near 4.7 million pounds. Voluntary disclosure clearly reduces exposure, but it does not remove it.

The breaches trace back to the disorienting weeks after February 2022, when sanctions lists expanded rapidly and correspondent banking relationships needed urgent reassessment. That timing points to screening processes that lagged behind fast changing designations, not a deliberate attempt to evade sanctions.

A separate UK sanctions policy update has raised the maximum penalty OFSI can impose from 50% to 100% of the breach value. If applied in future cases, this change could roughly double the financial exposure for similar violations. It is a policy shift, not a detail of this settlement.

Practitioner angle

• Reconcile restricted account and correspondent banking lists against current OFSI designations on a continuous basis, not only at onboarding.
• Pull records for any accounts linked to Russian counterparties that were active between February and November 2022, and confirm each was screened against the designations in force at the time.
• Confirm that payment screening blocks a transaction immediately once a new designation takes effect, rather than waiting for a periodic batch update.
• Revisit voluntary disclosure procedures now. The discounts in this case cut the penalty by 40%, but a breach still produced a 4.7 million pound fine, and the penalty cap for future breaches may double.

The single most important action: audit every account tied to a designated Russian bank that was open during 2022, and confirm each one was screened against the sanctions list in force at that time.