UK expands sanctions enforcement to crypto payment routes and proposes higher fines

Britain is broadening its sanctions enforcement by targeting the payment routes that enable Russian‑linked crypto transactions, not just the entities named on sanction lists.

National Crime Agency alert

On August 31, the National Crime Agency (NCA) issued a nationwide industry alert covering the A7 network. The alert urges banks, payment providers and crypto firms to examine counterparties, intermediary wallets and cross‑border infrastructure tied to Russia‑related transactions.

New compliance focus

The guidance pushes compliance teams beyond traditional name‑screening. Authorities highlighted several risk indicators, including:

• Intermediary wallets and transaction hashes
• Decentralised exchanges and mixers
• Over‑the‑counter and peer‑to‑peer routes lacking KYC controls
• Chain‑hopping, VPN use and frequent changes to infrastructure

These signals are intended to help firms identify the “nexus” between organised crime and sanctions evasion.

Proposed increase in civil penalties

The UK government is consulting on a proposal to raise the maximum civil penalty that the Office of Financial Sanctions Implementation (OFSI) can impose for breaches involving measurable funds or economic resources. The ceiling would rise to the greater of £2 million or 100 % of the breach value, up from the current £1 million or 50 %.

If enacted, firms could be fined the full value of an identifiable breach, though OFSI would retain discretion to impose lower amounts.

Background on the A7 network

The A7 network is a cross‑border settlement system that, according to UK authorities, has used financial institutions in third‑country jurisdictions, SWIFT and other international payment infrastructure to move funds for Russian clients. The network self‑reports processing more than $86 billion in its first year, though this figure has not been independently verified.

Previous enforcement actions

Earlier UK assessments linked crypto liquidity flows from the exchange Garantex to the Kyrgyzstan‑registered entity Grinex via a ruble‑backed token (A7A5). By May 2025, Grinex recorded over $1.2 billion each in inbound and outbound USDT transaction volume. The U.S. Treasury noted that Garantex employees assisted in creating the Grinex infrastructure.

Implications for firms

The alert signals that sanctions exposure may persist even when a crypto exchange, wallet or payment service changes its name, jurisdiction or technical rails. Firms are expected to monitor transaction pathways and associated assets closely to avoid potential penalties.