Finland – sanctions enforcement statistics: over 900 investigations, hundreds of fines and dozens of convictions

Press reporting in Finland has provided an update on Finland’s sanctions enforcement.

The update provides:

  • over 900 preliminary investigations commenced by Finnish Customs:
    • 13 started between 2018 and 2021;
    • 306 started in 2022;
    • 492 started in 2023; and
    • 83 started in 2024 (January to September, with an uncertain number since then)
  • “More than half” involved minor regulatory offences and have been resolved by monetary fines without recourse to the court system. These cases are further described as: “The fine cases mainly concern private individuals who have exported small quantities of banned goods across the border. Private individuals have exported, for example, luxury goods, not equipment needed by the military“.
  • “Dozens” of convictions and fines imposed by the courts for more serious offences. These are described as: “characterized by planning, systematicity and the pursuit of significant financial gain. Most often, they involve equipment needed on the front line. … The perpetrators in such cases are typically small or medium-sized export or logistics companies“.

The report provides no further details on the precise number of fines, the amount of fines, or other sentencing involved.

A separate report notes that the Finnish Navy has established a controlled area in the Gulf of Finland where Russian-linked vessels are inspected. This de facto maritime detention zone is encircled by Finnish naval forces and that currently 20 Russian “shadow fleet” vessels are “under scrutiny, with several facing potential long-term detention“.

Bermuda – trust company fined $600,000 for sanctions and AML compliance failings

On 30 December the Bermuda Monetary Authority announced the imposition of a fine of $600,000 on Meritus Trust Company Limited for a series of AML and sanctions compliance failings.

In terms of sanctions compliance the failing was specified as “An overreliance on manual processes to implement international sanctions policies and procedures and sanctions screening“.

The BMA’s on-site investigation was commenced in June 2022 and the company was then given a deadline of July 2023 to complete the necessary remediation. The BMA was satisfied with the company’s efforts and noted a number of mitigating factors such as a low risk of loss to clients, co-operation, the remediation efforts, and the company’s overall culture of compliance.

This is a rare example of a sanctions enforcement fine being imposed in one of the UK’s overseas territories or crown dependencies. The only other example known (to this blog) are the fines and other punishments imposed in Guernsey in 2015/2016.

United Kingdom – three penalties imposed by HMRC for breaches of Russian trade sanctions

On 4 November 2024, HMRC published a Notice to Exporters regarding a compound penalty of £58,426.45 imposed for breaches of Russian trade sanctions.

The Notice included the line:

Since February 2022, HMRC has issued six compound settlements against UK companies that have breached the Russia sanctions regulations for a total of £1,363,129, including one in August 2023 for £1 million“.

This struck a chord because, as captured in this blog, only three compound penalties had been publicly imposed by HMRC for breaching Russian sanctions. So a Freedom of Information request was made about the other three.

The response is here.

The response discloses details of three compound penalties (totalling c. £237,000) from August and September 2022 and April 2023. These had each been previously published, but had not previously been described as relating to Russian sanctions.

  • August 2022 – £1,000.00 was paid relating to the export of goods in breach of The Russia (Sanctions) (EU Exit) Regulations 2019.
  • September 2022 – £19,689.20 was paid relating to the export of goods in breach of The Russia (Sanctions) (EU Exit) Regulations 2019.
  • April 2023 – £217,012.50 was paid relating to the export of goods in breach of The Russia (Sanctions) (EU Exit) Regulations 2019.

It is unclear why these penalties were not previously described as relating to breaches of Russian sanctions.

The FOIA request also asked for the names of the individuals or companies which were the subject of the penalties; whether any had self-reported; and what (if any) confiscation of the proceeds of crime was applied. These questions were not answered.

United Kingdom – company convicted of export control violations

His Majesty’s Revenue and Customs (HMRC) has announced the conviction of the company EDM Limited on three counts of exporting controlled military goods without the appropriate licence.

The good in question were military flight simulators valued at £38,967.68.

The company was fined £89,359.80, including costs, but HMRC’s Notice does not mention whether a confiscation order was also made.

EDM Limited had been offered a civil compound penalty to resolve the matter but had not accepted the offer in time and so the case went to trial.

Hungary – fine imposed on individual for imports from Russia

It is being reported that Hungarian authorities have reached a settlement to resolve the prosecution of an individual identified as M.M.

The prosecution was based on importing car parts from Russia, via Belarus, in breach of the EU’s sanctions.

The imports are said to have been valued at HUF 35 million (€84,500), and the agreed settlement was for a fine HUF 1 million (€2,400), the confiscation of the imported parts and the payment of legal costs.

This is the first known example of an enforcement action in Hungary.

Latvia – update on current sanctions enforcement including 5 convictions in 2024

An article in Latvia’s LTV has provided an update on a number of features of Latvian sanctions enforcement.

Firstly, the Customs Administration stated that they had confirmed 2,623 breaches of sanctions so far this year up from 2,175 in 2023.

It was also stated that to date “€662,498.27 worth of goods have been confiscated in favor of the State in criminal proceedings for breach of sanctions”.

This is a substantially higher figure that those for confiscations identified in our recent post summarising Latvian convictions obtained in 2022 and 2023.

The article also stated that a total of 14 prosecutions had been brought in relation to the making available of economic resources to companies (i.e. the websites Sputnik and Baltnews) owned or controlled by Dmitry Kiselyov.

Two of those prosecutions ended in convictions in 2023 (as per our earlier post above), but the article adds that “This year [i.e. 2024], three more cases have ended in fines and community service”.

Lastly, the article adds that there have been two other convictions obtained during 2024, but that none of the 2024 judgments have yet entered into force.

Although not mentioned in the article, it has been confirmed to me by Paulis Iljenkovs of Latvia’s FIU (who has also consented to me sharing the information), that Latvia currently has 382 ongoing sanctions investigations.

Latvia – details of the 10 Russian/Belarusian sanctions convictions from 2022 and 2023

With gratitude to a Paulis Iljenkovs of the Latvian FIU who pointed me to the website of Latvian anonymised case law, we can publish details of the criminal convictions to date under the EU’s Russian and Belarusian sanctions regimes.

As per an earlier post (here) it had been reported that there had been seven convictions to over 2022 and 2023. When including cases where companies and individuals were both convicted the correct figure is 10 convictions in 7 cases.

The website including Latvia case law is here. The case numbers provided below can be entered into the “Atlasīt pēc arhīva numura:” window to retrieve the judgments themselves which are in Latvian.

A. Case K77-3109-23. Riga City Court. 30 October 2023.

This case concerned the export of a Bentley Mulsanne Speed luxury vehicle to Russia that was sold for €112,552.69 in breach of the EU’s prohibitions on the export of luxury goods.

The company was convicted and fined €111,600 and had the full proceeds from the sale of the car confiscated as well.

The senior individual within the company was also convicted and personally fined €62,000.

In an earlier post we had reported that the total fine from this case was €170,000, but this sum excluded the confiscation.

B. Case K77-2464-23. Riga City Court. 25 October 2023.

The case was the prosecution of an individual who worked for Rossiya Segodnya, a Russian state media channel (the company is not named in the judgment, but is known from earlier press releases as per our earlier post).

The journalist was prosecuted for making “economic resources” available to a designated person, with Rossiya Segodnya having a designated person – Dmitry Kiselev – as its Director General.

The court held that the work product prepared during the course of employment constituted “economic resources” and that making these available to a designated person was a breach of the asset freeze imposed on Kiselev under the EU’s sanctions.

The fine was €6,820.

C. Case K77-2465-23. Riga City Court. 26 June 2023.

This case is twinned with Case B (K77-2464-23) above. The prosecution was of another journalist working for the same organisation, and the same case theory of the work product constituting “economic resources” was pursued.

In this instance, however, the journalist pleaded guilty and expressed remorse.

As part of a plea deal the individual was sentenced to 140 hours of community service.

The judgment itself concerned whether this plea deal was procedurally proper as a matter of Latvia law, and it was upheld.

D. Case K77-3055-23. Riga City Court. 17 October 2023.

This case was the prosecution of a company and individual for importing gas cylinders and valves from Belarus in breach of import prohibitions under the EU’s sanctions. The contract value was €73,508.

A senior person within the company, and the company itself were prosecuted and convicted.

The individual was fined €12,400.

The company was fined double that sum – €24,800, and had profits of €9,500 confiscated. This figure is not explained but may have been the profit made from on-selling the imported goods. The company was also banned from conducting any further business with Belarus for a year.

E. Case K12-0283-23. Daugavpils Court. 14 April 2023.

We have posted on this conviction previously.

The case concerned the conviction of an individual for importing 8kg of nails and 13 consignments of railway sleepers from Belarus in breach of the EU’s sanctions.

The man was fined €6,200 and barred from importing any goods from Belarus for a year.

A co-accused was also convicted (the judgment for which could not be found on the case law website) and was fined €5,000 and given a similar ban from importing any goods from Belarus for a year.

F. Case K77-1597-23. Riga City Court. 20 February 2023.

This case concerned the transfer of a professional football player from a Latvian club to a Belarussian club that was 79% owned by a designated person.

The transfer fee was US$50,000.

The player was treated in the judgment as an “economic resource” made available to a designated person in breach of the EU’s asset freeze.

The senior individual at the Latvian club pleaded guilty and was fined €6,200.

The club was also convicted and had the full US$50,000 transfer fee confiscated.

Romania – 23 companies fined for sanctions breaches imposed to date

The news website g4media in Romania has made a Freedom of Information request to Romania’s ANAF enforcement agency.

It has published an article summarising the results, and also provided the original response.

The response identifies the following enforcement statistics:

  • 23 companies fined for sanctions breaches to date (between 2020 and 2024);
  • 560,000 lei in fines (c. €112,000);
  • 41,492,169 lei confiscated as the proceeds of crime (c. €8,330,000);
  • 11 of the fined companies have appealed the fines imposed:
    • 4 of those appeals were won by ANAF;
    • the ANAF lost one;
    • 6 of the appeals are pending, although ANAF won 4 of those at first instance;
  • As part of this enforcement ANAF also undertook 7 audits of companies which were doing business with sanctioned entities and imposed fines of 65,575 lei (c. €13,100).

As per our earlier post, as of November 2022, Romania was reported to have imposed fines of 280,000 lei and confiscated 13,171,000 lei (c. €2,650,000). The balance of these further fines have been imposed since that date.

Netherlands – conviction and confiscation for exporting sanctioned goods to Russian companies

The Rotterdam District Court has issued two judgments relating to the conviction and sentencing of an individual for exporting computer goods and software destined for Russian companies via intermediaries in Kazakhstan, Kyrgyzstan and Uzbekistan.

According to the judgment convicting the individual, the man had been selling computer equipment to two Russian companies prior to 2022. After the goods in questions became sanctioned, a fact he was made aware of by his customs agent, the man directed the exports to affiliates of his Russian customers in Kazakhstan, Kyrgyzstan and Uzbekistan. All the communications, however, remained with the Russian companies.

In an attempt to cover his tracks the man forged a contract between his company and the central Asian entities and provided this in response to questions from his bank.

The court convicted him of the charges, including forgery, holding that the EU Regulations did not require proof that the goods were actually delivered to Russia.

The exports in question were of thousands of items which were either dual-use or luxury goods and were predominantly computer equipment and software.

At sentencing the court made a number of comments:

  • firstly that “the court looked at penalties imposed in comparable cases, although there is not much comparative material”; and
  • the court’s aim in sentencing was to “give the suspect a good rap on the knuckles”, but not to hinder the man’s ability to continue operating his business.

The man was given a custodial sentence equivalent to the length of his time served in pre-trial detention (450 days), a suspended sentence of just over 11 months, suspended for two years, and a community service order of 240 hours.

Goods which had been seized during the investigation were returned to him.

The second judgment related to confiscation of the proceeds of crime from the man.

The court calculated that the gross proceeds of the crimes were €1,924,579, from which the court deducted €1,626,269 in what it described as “deductible costs”, leaving a final figure for confiscation of €298,310 which the court considered to be the company’s “profit”. This was the amount the man was ordered to pay by way of confiscation order.

The judgment does not record the Court (or the prosecution) giving consideration to the recent CJEU judgment which upheld a confiscation of the gross proceeds of crime.

Germany – seven year sentence for exports of military and dual-use goods to Russia and confiscation of profits

It is being reported that the Higher Regional Court in Stuttgart has convicted Ulli S, a 56 year old man, of breaches of the EU sanctions against Russia and the German foreign trade law.

As per our earlier posts, the man was arrested in August 2023, and had been charged in November 2023.

The exports were of machinery which can be used for the manufacture of sniper rifles and other weapons. Some of the exports were sent to Russia via Switzerland and others via Lithuania, while the customs data was falsified.

The contracts for the supply of the goods had been entered into in 2015.

The individual is said to have profited by 2.1 million euros, while a Swiss holding company benefitted by roughly 3 million euros. According to Der Spiegel these sums have been confiscated.

The trial lasted several months and is subject to a possible appeal.

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The opinions expressed on this blog are those of the author and are not to be construed as legal advice.

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