An Apple subsidiary has been fined nearly £400,000 by the UK government for breaching sanctions against Russia, in what is believed to be the first penalty of its kind levied against a major technology platform for processing payments to a sanctioned entity.
The Office of Financial Sanctions Implementation (OFSI), the Treasury’s sanctions enforcement body, imposed a £390,000 penalty on Apple Distribution International (ADI). The Irish-based subsidiary, which handles Apple’s product sales across Europe and the Middle East, instructed a UK-based bank to make two payments totalling £635,618.75 to the Russian streaming service Okko in June and July 2022.
Payments to a Sanctioned Entity
The payments were made from an ADI bank account in Britain. At the time, Okko was subject to UK asset-freeze restrictions because it was owned by a sanctioned Russian company, JSC New Opportunities. The UK government had placed JSC New Opportunities under sanctions in June 2022, just before the first payment was made.
OFSI stated it was satisfied that, on the balance of probabilities, ADI had breached prohibitions imposed by financial sanctions legislation. The watchdog noted that ADI voluntarily disclosed the payments in October 2022 and that the fine was imposed after settlement talks. It also said the company had no reason to suspect the payments would breach sanctions at the time.
In a statement, an Apple spokesperson said: “We follow the laws in the countries where we operate and take sanctions compliance extremely seriously. After identifying two payments to a developer that days earlier had become affiliated with a sanctioned entity, we promptly and proactively reported our finding to the UK government.”
The Complex Ownership of Okko
The breach centres on the rapidly changing ownership of Okko, a platform founded in 2011. Russia’s largest bank, Sberbank, acquired Okko in 2018. Following Russia’s full-scale invasion of Ukraine in February 2022, Sberbank—which was itself among the first Russian companies added to the UK’s sanctions list—sold Okko and other digital assets in May 2022.
The buyer was JSC New Opportunities, a company created in March 2022 with minimal authorised capital. According to the US think tank the Foundation for Defense of Democracies, this sale to an “obscure company” was likely an “attempt to shield those assets from western sanctions.” Information about the company’s ownership is restricted under Russian law.
Once the UK sanctioned JSC New Opportunities in June 2022, any assets it owned, including Okko, were frozen under the regulations. The payments from Apple’s subsidiary were processed in the weeks immediately following this designation.
How a Non-UK Company Falls Under UK Sanctions Law
The case establishes a significant precedent, clarifying that app store payment flows fall within OFSI’s enforcement scope and that platform operators have compliance obligations regarding their developers’ ownership. Crucially, it underlines that non-UK companies can be found in breach of UK sanctions if they use UK financial institutions to conduct transactions.
OFSI explicitly stated that the case served as a warning: firms should ensure they have robust due diligence frameworks to monitor their client and customer base. The watchdog highlighted that using third-party sanctions screening firms—as Apple did—carried risks. While there were publicly available press articles stating Okko was owned by a sanctioned entity, OFSI found no evidence that ADI or its third-party providers were aware of this information at the relevant time.
This enforcement action also marks the first OFSI case resolved through a settlement under a scheme introduced to speed up proceedings, which offers discounts for waiving appeal rights. Apple faced a maximum penalty of £1 million, which was reduced due to the voluntary disclosure and the settlement discount.
The fine comes amid a broader shift in OFSI’s enforcement posture, towards more proactive, intelligence-led investigations and tightened penalty frameworks. It signals that the UK’s sanctions watchdog is prepared to scrutinise complex international payment chains, regardless of where the instructing company is headquartered, so long as UK financial services are involved.
