Money Laundering Regulations

Money Laundering regulations are designed to protect financial systems. Businesses are required to put into place controls to prevent themselves (the business) from being used for money laundering by criminals and terrorists.

UK Money Laundering Regulations

Businesses in the UK are required to be vigilant and mindful of transactions that could be used for money laundering by criminals and terrorists.

In the UK, Money Laundering Regulations are governed by The Money Laundering Regulations 2007 and its amendments. These regulations came into force in December 2007 and include the application of regulations, customer due diligence, record keeping and supervision.

A review of the The Money Laundering Regulations 2007 by The Treasury began in 2009. The review focused on whether the regulations were effective and proportionate in practice, identifying where they are working well and where there may be room for improvement. That review of the Money Laundering Regulations and consultation process resulted in the Money Laundering (Amendment) Regulations 2012, which will come into force on 1st October 2012.

It should also be noted that the practice of anti-money laundering should also be established in order to comply with The Proceeds of Crime Act 2002 and the Terrorism Act 2000. Similar provisions are set out in the Republic of Ireland under the Criminal Justice (Money Laundering and Terrorist Financing) Act 2010.

The Money Laundering Regulations apply to a number of different business sectors, including financial and credit businesses, accountants and estate agents. Every business that is covered by the regulations must be supervised by a supervisory authority. Some businesses may already be supervised by an approved professional body as set out in Schedule 3 of the Money Laundering Regulations 2007. If your business isn’t already monitored, and it falls into one of four designated business sectors – Money Service Businesses, High Value Dealers, Trust or Company Service Providers, Accountancy Service Providers – you will probably need to register with HM Revenue & Customs (HMRC), although there are a few exceptions.

Nonetheless, if your business falls outside the requirement for regulation by a supervisor body, it remains essential to be vigilant and mindful of transactions that could be used for money laundering by criminals and terrorists.



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