Jordans Trust Company blog

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UK: new money laundering and transfer of funds regulations

The UK government has published draft Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (the “MLR 2017”). These regulations transpose the EU Fourth Money Laundering Directive and the Fund Transfer Regulation which accompanies it.

The MLR 2017 are open to final consultation until 12 April, with the MLR 2017 expected to come into force on 26 June 2017.

The MLR 2017 are designed to ensure that the UK’s anti-money laundering and counter-terrorist financing regime is kept up-to-date, is effective and is proportionate. Furthermore, the MLR 2017 replace the Money Laundering Regulations 2007 and the Transfer of Funds (Information on the Payer) Regulations, 2007.

In relation to its anti-money laundering parts, the MLR 2017 introduce a number of new and updated requirements on relevant businesses. For example:

(a) refinements relating to the due diligence (“DD”) to be collected, including enhanced DD and simplified DD

(b) greater detail surrounding the risk assessment to be carried out by relevant businesses

(c) refinements to the treatment of politically exposed persons, including taking a proportionate approach to the collection of enhanced DD

(d) where appropriate, the establishment of an independent audit function to monitor the adequacy and effectiveness or procedures and that they are being complied with

(e) changes to the supervision regime including HM Revenue and Customs acting as a registering authority for all trust and company service providers, who are not registered by the Financial Conduct Authority

(f) HM Revenue and Customs to launch a central register of beneficial ownership information for express trusts with tax consequences

(g) the potential for information surrounding people with significant control to be filed more frequently than currently required.

Jordans Global Monitoring is a secure, uncomplicated and user-friendly system that allows professional organisations to automatically screen their individual and corporate or business clients on a daily basis. Read more on our Global Monitoring service here and if you would like to book a demonstration or find out how we can help your business, please get in touch.

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