How do we check an overseas partner or payment against sanctions?

England and Wales: This page sets out the position in full. Scotland: the same position. Sanctions and terrorism law are reserved, so the same law and the same regulator, OFSI, apply. OSCR has no sanctions guidance of its own. Northern Ireland: the same position, for the same reason. CCNI has no sanctions guidance of its own. One thing differs: the most a magistrates’ or sheriff court can impose for the offence — see the penalty list below.

Four things that look alike and are not

Charity sanctions screening protects against four different exposures. Guidance written for charities tends to run them together. The law is the same across the UK. It matters to the trustees and to whoever authorises payments.

This page follows the step to set up a partnership or collaboration agreement, and assumes you have already established authorisation limits for payments. Screening names individuals, so the checks also belong on your data map with a lawful basis recorded against them.

The four have different fault standards and different results. Mixing them up leads to the wrong conclusion in both directions.

	What it is	Does it need knowledge or suspicion?	Does it apply to an ordinary charity?
1	The criminal offence of breaching a sanctions prohibition	Yes — knowledge or reasonable cause to suspect	Yes
2	OFSI’s civil monetary penalty	No — not since 15 June 2022	Yes
3	The statutory duty to report to HM Treasury	—	No — it binds financial firms
4	The Terrorism Act 2000 offences and disclosure duty	Intention or reasonable cause to suspect, and a belief or suspicion for the duty	Yes

Sections 1 to 4 take each in turn. Do not let one borrow another’s test.

1. The criminal offence: knowledge or reasonable cause to suspect

UK sanctions are made under the Sanctions and Anti-Money Laundering Act 2018. That Act applies across the UK. Each regime has its own regulations. This page uses the Russia regulations as the example, because OFSI’s own charity guidance does. The pattern is the same in every regime. The regulation numbers are not.

The Russia (Sanctions) (EU Exit) Regulations 2019, UK-wide, set out the asset-freeze prohibitions. A person must not:

• deal with funds or economic resources owned, held or controlled by a designated person (reg. 11)
• make funds or economic resources available to a designated person, directly or indirectly (regs. 12 and 14)
• make them available for the benefit of a designated person (regs. 13 and 15)

Each is subject to the exceptions and licences in Part 7 of the regulations.

“Economic resources” is wider than it sounds. It covers anything that could be exchanged for money, goods or services. Making economic resources available is caught where the person knows, or has reasonable cause to suspect, that the designated person would be likely to exchange them, or use them in exchange, for funds, goods or services. Letting a designated person use your premises rent-free, or supplying goods, can breach the prohibition without any cash changing hands.

A designated person is someone named on the UK Sanctions List. These prohibitions freeze their funds and economic resources.

Each prohibition applies only if the person knows, or has reasonable cause to suspect, what they are doing. That is an objective test: what a reasonable person would have suspected. It is not strict liability. The prosecution has to prove it.

Breaching one of these prohibitions is an offence. It is committed by “a person” — so by the charity as an organisation, and by any individual who does the dealing.

Where a body corporate commits the offence with the consent or connivance of a director, manager, secretary or similar officer, or through their neglect, that officer is guilty too (reg. 81). For an unincorporated charity, the same applies to members of its governing body.

2. The civil penalty: no knowledge needed

This is the change most charity guidance has not caught up with.

OFSI, part of HM Treasury, can impose a civil monetary penalty for a sanctions breach. The power is in the Policing and Crime Act 2017 s.146, which applies across the UK. An amendment by the Economic Crime (Transparency and Enforcement) Act 2022 s.54(3) took effect on 15 June 2022. Since then, OFSI has not had to show that anyone knew or suspected anything.

Section 146(1A) says, verbatim, that “any requirement … for the person to have known, suspected or believed any matter is to be ignored.”

So a charity can be penalised for a breach it did not know about and had no reason to suspect. The maximum is £1,000,000, or half the estimated value of the funds or resources involved if that is greater. HM Treasury can reduce the penalty for a prompt, complete voluntary disclosure.

This is not a criminal penalty. But “we didn’t know, so we’re safe” may be right about the offence and wrong about the penalty.

3. The reporting duty your charity does not have

The Russia regulations, reg. 70, require some organisations to tell HM Treasury as soon as practicable. That applies if they know or suspect that someone is a designated person or has breached a prohibition. Failing to do so is itself an offence under reg. 70(6).

That duty binds “relevant firms” only (reg. 71). They are firms authorised under the Financial Services and Markets Act 2000, statutory auditors, money service businesses, cryptoasset firms and similar financial businesses.

An ordinary charity doing its own charitable work is not one. Your bank usually is. That is why a bank may freeze a payment or ask screening questions. That is the bank doing its own duty, not yours.

The same is true of money laundering. Under the Money Laundering Regulations 2017, reg. 8, UK-wide, a charity is not a “relevant person” for its own activities. When a bank asks for proof of identity, the bank is doing its due diligence on you.

OFSI’s guidance tells charities to contact it immediately on finding they are dealing with a designated person. A charity is not a relevant firm, so that is not a statutory duty.

But contacting OFSI is not optional in practice either. The prohibition still applies, the offence still applies, and the civil penalty needs no knowledge. Contacting OFSI is how you stop a breach from continuing.

4. The Terrorism Act 2000: a separate statute, a lower threshold

The Terrorism Act 2000 applies across the UK. It sits alongside sanctions law. The same payment can breach both.

Sections 15 to 18 create four offences. Sections 15 to 17 turn on intention, or knowledge, or reasonable cause to suspect that money or property will be used for terrorism. Section 18 works differently, as the list says:

• s.15, fundraising — inviting, receiving or providing money or property
• s.16, use and possession — using it, or possessing it, for those purposes
• s.17, funding arrangements — becoming concerned in an arrangement that makes money or property available
• s.18, money laundering — an arrangement that helps someone keep or control terrorist property. The person charged has a defence if they prove they did not know, and had no reasonable cause to suspect, that the arrangement related to terrorist property (s.18(2)).

Any person can commit them — the charity, a trustee, a member of staff.

The Act also gives defences to all four offences where a person tells an authorised National Crime Agency officer of their suspicion. That covers a disclosure made, and consent given, before they become involved (s.21ZA). It covers a disclosure made on their own initiative as soon as reasonably practicable after they become involved, where there was a reasonable excuse for not making it before (s.21ZB). And it covers someone who intended to disclose and had a reasonable excuse for not doing so (s.21ZC).

Section 19 adds a duty to tell the police. It applies when a person believes or suspects that someone has committed one of those four offences. It covers what they learned through a trade, profession or business, or through their job.

They must tell a constable, or an authorised National Crime Agency officer, as soon as they reasonably can. Failing to do so is an offence, and the individual commits it.

Section 19 has three defences:

• a reasonable excuse (s.19(3))
• reporting under the employer’s own set procedure (s.19(4))
• for a professional legal adviser, information that came to them in privileged circumstances (s.19(5))

A member of staff who discloses under the employer’s established procedure has the second defence.

Information that comes through a bank or a regulated professional firm falls under a separate section, s.21A, instead. That is for those firms, not for ordinary charities.

One question is open. The Act does not say whether an unpaid volunteer or trustee, acting only in that role, is “in the course of their employment”. No source resolved it. The people part of this guide flags the same point.

Charity sanctions screening: before money leaves the UK

OFSI does not require any particular checks. Its guidance recommends a risk-based, proportionate approach. You should follow it as OFSI’s recommendation:

1. Screen the partner organisation, its directors and any intermediary — including a money transfer business — against the UK Sanctions List. The list is free.
2. Screen before money or resources leave the UK, and again when anything changes.
3. Write a procedure saying who screens, when, against what, and what happens on a match. Have the board minute it.
4. Record each check with its date and result.
5. Train the people who pay, and give staff a confidential way to raise a concern.

On a match, OFSI’s guidance names three steps:

• contact OFSI immediately
• freeze any funds or resources you hold for that person
• do not make anything available to them

If a licence might cover what you want to do, you have to apply before acting. A licence cannot be granted after the event.

Screening is one part of a wider duty. The Charity Commission’s guidance on money sent overseas expects due diligence that is risk-based and proportionate, not a checklist: the greater the risks, the more trustees have to do. It rates monitoring after the money is sent as highly as checks before. It says trustees must monitor the use of the charity’s funds, checking both that they reach their destination and that they are used for the purposes intended.

Keep your contact details current on the Charity Commission’s register. On 14 March 2025 OFSI published a finding that three UK-registered charities had breached reg. 36(6) of the Counter-Terrorism (International Sanctions) (EU Exit) Regulations 2019.

OFSI had sent each a request for information, three times, to the contact details on the Commission’s public register. None replied. OFSI assessed the breach as moderately severe. It imposed no penalty but published the case.

It was a failure to answer OFSI, not a finding that the charities had dealt with anyone sanctioned. A charity can breach sanctions law without ever meaning to deal with anyone sanctioned.

Money moved outside the banking system is not forbidden, and not exempt. Informal value transfer systems — hawala and its equivalents — are lawful in the UK. Many operators are registered with HMRC. The Commission expects, as OFSI relays it, that trustees can show the decision was reasonable and the risks were managed.

Screen the whole payment route. Cash couriering is treated like any other transfer. If you suspect the transfer operator is not compliant, OFSI’s guidance says to stop using it and report it to HMRC.

“Humanitarian” is not a permission

OFSI’s guidance, verbatim: “Activity is not necessarily permitted just because it is for a charitable or humanitarian purpose.”

Two routes can help. Neither is automatic. This part was checked on 20 September 2026. OFSI changes it often. Check the current position before you rely on it.

• The UN humanitarian exception. The Sanctions (Humanitarian Exception) (Amendment) Regulations 2023, UK-wide, came into force on 9 February 2023. The exception covers UN sanctions regimes, except Afghanistan, which has its own. You do not apply for it. But it covers you only if two tests are met. Condition A: the work is done by one of these:
  • the UN, including its programmes, funds and other bodies
  • international organisations
  • humanitarian organisations with observer status at the UN General Assembly
  • non-governmental organisations taking part in UN Humanitarian Response Plans
  • the employees, grantees, subsidiaries or implementing partners of any of them
  • anyone else the relevant UN committee authorises

  Condition B: you believe the activity is necessary to ensure the timely delivery of humanitarian assistance, and there is no reasonable cause to suspect otherwise. For the ISIL (Da’esh) and Al-Qaida regime, OFSI’s guidance describes the exception as time-limited and dependent on the UN Security Council renewing it. Check OFSI’s current guidance before relying on it for that regime.

• General licences. A general licence is OFSI’s published permission for a stated kind of activity under one sanctions regime. OFSI issues these one regime at a time. Most carry conditions and a duty to report back. The Russia regime, for example, has a general licence for aid work. It was first issued on 7 July 2022 and last changed on 5 February 2026. Check OFSI’s live list, not a copy.

Some things cannot be licensed at all, such as certain fees or taxes paid to a designated person. These can also raise issues under the Bribery Act 2010.

What sits on other pages

The annual return. The Charity Commission’s annual return asks about activities outside the UK, overseas spending and how money was sent. That belongs to the Reporting hub, which carries the question list in what the annual return actually asks. This page does not repeat it.

One point is open there. The return’s question guide states an income threshold for some questions, but states none for section 3, on activities outside the UK. No figure has been confirmed as the gate for that section. So this page gives none.

Serious incidents. A sanctions breach, or a link to someone under an asset freeze, is one of the Commission’s named categories of serious incident. Reporting one is covered in the Reporting hub: recognise a serious incident, then make a serious incident report.

Keep the two routes apart. A serious incident report goes to the Commission. A Terrorism Act s.19 disclosure goes to the police.

Scotland and Northern Ireland. Sanctions law is reserved and identical across the UK. OSCR and CCNI each publish no sanctions guidance of their own. Use OFSI’s guidance in all three nations.

Next: set your rules for beneficiary stories and images. That step applies to every charity that tells its story in public.

Common mistake: assuming a charity is legally required to report a suspected breach to OFSI, the way a bank is

OFSI’s guidance tells charities to contact it immediately, which reads like a legal duty. Banks treat reporting as mandatory. A charity is not a “relevant firm” under reg. 71, so it has no reg. 70 duty.

But the prohibition and offence apply regardless, and the civil penalty has needed no proof of knowledge since 15 June 2022. “We’re not a relevant firm” does not make contacting OFSI optional in any practical sense.

Common mistake: not keeping the charity’s registered contact details current, and missing an OFSI request for information

Updating the register feels like admin, not sanctions work. But OFSI writes to the address on the public register. In March 2025 it published breaches by three charities that never answered its letters, sent three times to that address. There was no fine. The breach was still made public.

Common mistake: treating “humanitarian purpose” as automatic permission

The word sounds like an exemption. OFSI says plainly that it is not. Two routes exist, each with its own tests. Some payments cannot be licensed at all.

Common mistake: confusing the criminal offence’s fault requirement with OFSI’s civil penalty test

Much sector content, and some of OFSI’s own general text, still describes breaches in terms of knowledge or suspicion. That is because it is still the test for the offence. Since 15 June 2022 it is not the test for the civil penalty.

A trustee may reason “we didn’t know, so we’re safe”. That may be right about criminal liability. It may be wrong about a civil penalty up to £1,000,000 or more.

Worked example

Saltmarsh Trust wants to fund a local partner that runs support work in a country where some officials and organisations are UK-designated persons. Part of the payment will go through a local money transfer business. That is because banking in the area is patchy.

The ordinary case. Before anything is paid, Saltmarsh’s finance lead screens the partner organisation, its directors and the transfer business against the UK Sanctions List. The finance lead saves the dated results. None is listed. No prohibition is engaged, and no licence is needed for this payment.

Because the transfer business is not a bank, the board minutes why using it is reasonable and how the risk is managed. The overseas spend and the transfer method go on the annual return in the way the Reporting hub describes.

The match. A year later, a district official involved in the project is designated. Saltmarsh stops the next payment, freezes anything it holds that the official controls, and contacts OFSI at once.

It does this because the prohibition applies and the civil penalty needs no knowledge. Saltmarsh is not a relevant firm, so it has no reg. 70 duty. It also considers whether a serious incident report to the Commission is needed.

The law is the same wherever in the UK Saltmarsh runs this work.