UK Government Strengthens Money Laundering Regulations

30 July 2007


The UK Treasury has published new regulations to strengthen its fight against money laundering and terrorist financing, both at home and abroad. The Money Laundering Regulations, which will take effect on December 15, are the result of extensive consultation with both the private sector and law enforcement, including two written consultation documents.

Kitty Ussher, the economic secretary to the UK Treasury says that these new regulations are in line with the government’s financial crime strategy and that they introduce tough and targeted new measures where the risks are greatest. She adds that the new regulations are also intended to reduce regulatory burdens for businesses and consumers in low-risk situations.

The main changes to the current regime include the following measures: extending supervision to all businesses in the regulated sector, such as estate agents, trust and company service providers and consumer credit businesses, in order to secure greater compliance with anti-money laundering controls; administering strict tests to guarantee that money services business and firms that help set up and manage trusts and companies are legitimate and not run for criminal purposes; requiring extra checks on customers that pose a higher risk of money laundering, such as foreign heads of state and non-face-to-face customers.

For low-risk businesses, under the new regulations, firms will be expected to perform fewer identity checks. There will also be greater flexibility to record-keeping rules so that firms need only keep the details that are important to them instead of whole documents.

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