FCDO Sanctions Expansion Highlights Need for Multi-List Screening
The new FCDO (Foreign, Commonwealth & Development Office) list is vital for effective UK sanctions screening because it expands the scope beyond just financial sanctions and meets the UK’s obligations under domestic and UN-driven regimes, especially amid heightened global sanctions activity. With the ongoing fight against illicit finance in full swing, staying up to date with ever-changing regulatory compliance requirements and safeguards remains challenging for even the most well-equipped of financial institutions. Upkeep with global watch and sanctions lists has become critically important for businesses and individuals engaged in international financial transactions and business activities for a number of reasons, including legal and financial risk, reputational protection, and compliance with national security objectives. Navigating the United Kingdom’s staunch sanctions regime in particular remains a daunting, yet critical task for businesses operating across a number of sectors including finance, shipping, trade, and travel. Given its proximity to other major European nations, its convenient time zone, and its history of financial inclusiveness, the UK has developed into arguably the world’s premier financial center. The UK now holds the title for highest net exports of financial services globally and accounts for more than one-third of global forex trading, with its global reach expected to grow even more significantly as a larger number of foreign banks and branches continue to move their operations to London. Given this standing, compliance failures for those operating within this jurisdiction can have far-reaching ramifications.
Today’s sanctions lists are dynamic and frequently updated, requiring organizations to stay informed about their changes and implement appropriate screening processes at a near-constant pace. Regularly screening against sanctions lists has gone from being a ‘best practice’ to a necessary one for financial institutions small and large, allowing them to both identify and mitigate risks associated with sanctioned entities, including money laundering, terrorism financing, and other illicit activities, while avoiding potential consequences for themselves in the long run. To achieve sanctions compliance in the UK, businesses have long utilized the Office of Financial Sanctions Implementation (OFSI) Consolidated List. First published in 2013, the OFSI list is a register of all entities designated under UK and United Nations financial sanctions, including asset freeze targets and those subjected to investment bans. The Office of Financial Sanctions Implementation, itself a government body that implements and enforces financial sanctions, publishes the consolidated list to help businesses and individuals comply with financial sanctions. While this list remains essential for screening customers, suppliers, and transactions to ensure adherence with current financial restrictions, the OFSI list remains non-comprehensive, focusing exclusively on financial sanctions while omitting broader measures such as travel bans, trade controls, and shipping restrictions. As such, relying solely on the OFSI list, while a common practice even today, can leave organizations vulnerable to significant gaps in their compliance framework.
This is where the Foreign, Commonwealth & Development Office (FCDO) Sanctions List comes into play. The FCDO Sanctions List fills in the gaps left by the OFSI for UK financial institutions, providing a comprehensive overview of all UK sanctions, including non-financial restrictions, made under the Sanctions and Anti-Money Laundering Act 2018 (SAMLA). This includes designations affecting individuals, entities, vessels, and aircraft, along with a wider range of sanctions: travel bans, transport and trade restrictions, procurement bans, and more.3 The list also provides detailed legal references, regime names, and effective dates, making it indispensable for businesses operating beyond the financial sector. When analyzed alongside the aforementioned OFSI list, UK financial entities can achieve bulletproof sanctions compliance, covering UK trade, transport and immigration controls, non-financial sanctions targets in a businesses supply chain and/or operations, as well as banned or previously off-limit individual targets.3
Recent geopolitical developments seen across Europe and beyond have highlighted the importance of this dual approach. According to a 2025 update on the UK government’s sanctions page, the UK regularly updates its sanctions lists to reflect shifts in this regard. These have come to include new designations targeting Russia, Belarus, and Iran of late. As 2025 has unfolded, the UK has announced sweeping sanctions targeting over 100 entities across Russia’s military, energy, and financial sectors. This included companies tied to weapons supply chains, disinformation networks, partnering financial institutions, and shadow-fleet tankers.2 With respect to non-traditional targets, the UK also recently established a sanctions regime targeting people smugglers, naming over 20 individuals – including those involved in financing, documentation, and hawala money transfers – for asset freezes and travel bans.1 Aside from the increase in scope of these recent sanctions efforts, management of both lists remains important for businesses for the shear fact that UK sanctions compliance has become increasingly complex post-Brexit.
As matters currently stand, failing to consult both the OFSI and FCDO risks lends to FI’s missing critical updates, such as newly sanctioned entities or expanded trade restrictions, which could lead to crippling penalties. The Office of Financial Sanctions Implementation (OFSI) itself can impose monetary penalties for breaches of financial sanctions, potentially reaching 100% of the value of the breach or a default fine of £1 million, whichever is greater. UK financial institutions have continued to invest heavily into their counter-response to both illicit financial activity and subsequently to these penalties. Reports indicate that a collective £35 billion was spent by UK-based financial institutions on financial crime compliance in 2023 alone, a 19% increase from 2020, driven by rising regulatory demands and the fear of succumbing to financial penalties for non-compliance, as well as increasingly sophisticated criminal exploits. To mitigate their growing number of risks faced, financial businesses must integrate both the OFSI and FCDO lists into their compliance programs. The OFSI list serves as a financial compliance tool, while the FCDO list provides a broader legal framework, ensuring all sanctions – financial and other – are addressed. As sanctions regimes evolve, particularly in response to global events, this layered approach is critical to the health of a financial institution, and the greater global financial system.
Citations
- Dathan, Matt. “People Smugglers to Be Named for First Time in New Sanctions Regime.” The Times & The Sunday Times, The Times, 22 July 2025.
- Tabahriti, Sam. “UK Hits Russia’s Military, Financial, Energy Sectors with New Sanctions | Reuters.” Reuters, 20 May 2025.
- Temple, Darren. “Why You Need the FCDO Sanctions List as Well as the OFSI Consolidated List.” Brighter Consultancy, Brighter Consultancy Group, 13 Aug. 2025.