The Treasury is pressing ahead with planned reforms to the UK’s anti-money laundering (AML) rules, aiming to clarify and strengthen the current regime.
These updates follow a consultation launched by the previous government between March and June 2024 and are based on a 2022 review that found several areas needing improvement.
A draft statutory instrument is expected in the coming months for technical feedback, with legislation potentially laid in Parliament later this year. The reforms will update the Money Laundering Regulations (MLRs), focusing on making the rules more effective and easier to apply.
Key changes include:
- Clearer enhanced due diligence (EDD) rules, limiting EDD to unusually complex transactions.
- Updated due diligence on high-risk third countries and pooled client accounts (PCAs), allowing broader use of PCAs under simplified rules.
- Currency thresholds will switch from euros to a GBP equivalent using a 1:1 conversion.
- Trust registration requirements under the Trust Registration Service (TRS) will be simplified, including a new de minimis exemption.
- Stamp duty reserve tax (SDRT) will no longer trigger TRS registration by itself.
- Onboarding rules will ease requirements in bank insolvency cases to support rapid account access.
- Regulation will tighten on sales of ‘off-the-shelf’ companies.
- Cryptoasset service providers will see updated rules under the Financial Services and Markets Act 2000.
- Enhanced information sharing between supervisors and closer collaboration with Companies House.
- Sovereign wealth fund exemptions will align with the FSMA Exemption Order 2001.
These changes are part of the government’s broader effort to reduce economic crime and modernise AML oversight.
Talk to us about your business.
