AML regulations in the UK might get softened

The UK isn’t deregulating its money-laundering rules, but officials say they want those rules to be more effective.

And it looks like deregulation, to at least some extent, will be part of the change envisioned by the government.

Decades after international terrorism made the fight against money laundering a priority in developed economies – and years after Brexit shook the UK’s trade practices – the government is considering tinkering with AML regulations.

This week, Treasury officials published a so-called consultation, or a document spelling out what they want to do and asking for input from citizens.

Don’t expect a role-back of fines, however. Last summer, the UK increased penalties.

In the government’s 70-page document (which is dated February 2024), four goals are laid out.

First, customer due diligence (CDD) responsibilities, which determine what constitutes sufficient identity verification as part of KYC, have to be “more proportionate and effective.” Then, money system coordination must be tighter.

The Money Laundering Regulations of 2017 have to be made clearer of non-experts. And last, registration requirements for the Trust Registration Service need to be reformed.

In one case, the document suggests that actions and situations that trigger the need for due diligence are not clear or sufficiently appropriate.

In another, officials say they want to be clearer about how companies performing their AML compliance work should use the National Risk Assessment of Money Laundering and Terrorist Financing.

Article Topics

AML  |  financial services  |  identity verification  |  KYC  |  regulation  |  UK