Citibank Hit with £4.7M Russian Sanctions as 970 Payments Slip Through Controls

Citibank’s London branch has been fined £4.7 million by the UK’s Office of Financial Sanctions Implementation, OFSI, after processing 970 payments worth £19.7 million in breach of Russia sanctions.

The violations occurred largely between February and November 2022, following the rapid expansion of Western sanctions against Russian individuals, banks and companies. Some transactions involved sanctioned entities including state owned shipping company PJSC Sovcomflot and Russian banks Alfa Bank, Gazprombank and Credit Bank of Moscow.

OFSI said it found no evidence of deliberate breaches, but described the errors and control failures as material and significant, spanning multiple business areas and systems. The regulatory pressure was intensified by Citi’s substantial Russian exposure, including correspondent banking relationships and payments connected to its Russian affiliate.

The case is a major sanctions compliance warning for global banks operating across rapidly changing regulatory environments.

For compliance teams, the lesson is clear. Sanctions screening cannot depend solely on static customer data or automated alerts. Institutions must continuously update screening rules, investigate name mismatches, manage correspondent banking exposure and ensure frozen assets are reported promptly.

The enforcement also demonstrates that absence of intent does not eliminate regulatory consequences.

Citi has cooperated with OFSI and continued investing in its sanctions compliance framework.

The message to financial institutions is blunt: when sanctions change faster than controls, even legitimate payment infrastructure can become a channel for prohibited transactions.