Committee publication · Correspondence · 25 February 2025

Correspondence from Sir Jim Harra, HM Revenue and Customs, relating to sanctions, dated 17 February 2025

Summary

Sir Jim Harra, Chief Executive of HMRC, responds to the Treasury Committee's January 2025 inquiry on sanctions enforcement. HMRC has recruited 40 additional criminal investigators since July 2022, strengthened detection capabilities, and established an enforcement partnership with the newly created Office of Trade Sanctions Implementation. As of January 2025, HMRC's sanctions team comprises 41 dedicated staff with 30 live investigations ongoing, primarily focused on Russia sanctions breaches.

Key findings

HMRC has recruited 40 additional criminal investigators and expanded policy, legal, and analytical capacity since July 2022 to enhance trade sanctions enforcement.
HMRC opened 29 potential sanctions investigations in 2024 (27 relating to Russia), compared to 14 in 2022 and 22 in 2023, with one case referred to Crown Prosecution Service in October 2024 awaiting charging decision.
Six companies received compound settlements totalling £1.34m for Russia sanctions breaches 2022–2024; one company received £1,000 for Iran sanctions breach in September 2023.
HMRC has not identified significant overlap between trade sanctions breaches and financial sanctions breaches; designated persons/entities for financial sanctions were generally not involved in trade sanctions investigations.
HMRC publishes sanctions breach details (company names, offences, penalties) through DBT notices, though company anonymity is considered on a case-by-case basis for compound settlements to maintain voluntary disclosure incentives.

Tone

Factual

Topics

sanctions-enforcementtrade-controlscustoms-authoritycriminal-investigationcompliance

Key actors

Sir Jim Harra, HM Revenue and Customs (HMRC), Dame Meg Hillier, Treasury Committee, Office for Financial Sanctions Implementation (OFSI), Office of Trade Sanctions Implementation (OTSI), Department for Business and Trade (DBT), National Crime Agency (NCA)

Notable line

“HMRC has not seen evidence of a significant overlap between businesses that breach trade sanctions and businesses that breach financial sanctions.”

Key Quotes

“Subsequent to the additional sanctions imposed on countries including Russia, Belarus and Iran since July 2022, HMRC has continued to prioritise sanctions enforcement and has strengthened its capabilities for detecting and responding to sanctions breaches”
— Sir Jim Harra · explaining changes in HMRC sanctions enforcement since July 2022

“HMRC has recruited 40 additional criminal investigators to detect and enforce trade sanctions offences.”
— Sir Jim Harra · outlining resource expansion for sanctions enforcement

“As of January this year, the team had 101 full-time equivalent staff, of whom 41 are dedicated to sanctions enforcement work, the majority of which relates to Russia sanctions.”
— Sir Jim Harra · disclosing staffing levels in FIS SE&SE team

“HMRC has not seen evidence of a significant overlap between businesses that breach trade sanctions and businesses that breach financial sanctions.”
— Sir Jim Harra · responding to question about overlap between different sanctions breaches

“Sanctions investigations can be complex and lengthy, and therefore the time it takes to investigate a breach and progress a case to prosecution can be considerable.”
— Sir Jim Harra · explaining absence of prosecutions to date despite ongoing investigations

“HMRC currently has 30 live criminal investigations into breaches of sanctions, 27 of which relate to Russia sanctions. None of these investigations has yet reached the point of prosecution”
— Sir Jim Harra · providing current investigation status

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Source · parliament.uk record ↗