The UK’s HM Revenue and Customs has announced the imposition of a compound penalty of £569,157 on Petrofac Facilities Management Limited.
This is the first time, in a long time, that HMRC has named the recipient of a compound penalty.
The breaches took place in 2022 and 2023 with the company supplying prohibited goods to individuals connected with Russia and also providing technical assistance in relation to those goods.
The company subsequently self-reported and cooperated with the investigation.
The change in naming policy is addressed:
“Naming those involved brings us into line with other enforcement partners whilst sending a clear message on the consequences of breaching sanctions rules.”
The Notice further states that “Where appropriate, HMRC will now include naming as a condition when offering a compound settlement for strategic export and sanctions offences“. It appears that naming will now become more common if not done universally.
The Notice also gives helpful guidance on when HMRC will consider a compound penalty rather than prosecution, noting that a penalty will only be pursued where HMRC considers it has enough evidence to prosecute, and other considerations, including:
- the seriousness of the alleged offence;
- whether fraudulent intent can be proven;
- the extent of the efforts to perpetrate the alleged offence;
- the type and value of any goods involved;
- the offender’s previous history;
- the extent to which the offender has co-operated with any investigation; and
- the level of financial penalties known to have been imposed by courts for similar offences.