Money Laundering Regulations 2007

Amendments to Money Laundering Regulations 2007 to Come into Force on October 1

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On July 17, HM Treasury published the Government’s response to its consultation on proposed changes to the Money Laundering Regulations 2007 (MLRs) together with its Impact Assessment (June 20). Response.  Impact Assessment.

The Government’s proposals aim to reduce the regulatory burden imposed by the MLRs, while strengthening the overall anti-money laundering (AML) regime. Among the proposals the Government plans to:

  • Retain the criminal penalties in the MLRs (even for minor breaches of the MLRs).
  • Remove the current distinction between bodies listed in Parts 1 and 2 of the MLRs for customer due diligence (CDD) reliance purposes.
  • Strengthen and clarify the powers of the Office of Fair Trading and HMRC.
  • Make the FSA the recognised formal supervisor for recognised investment exchanges (RIEs).

Payment Services Regulations 2012 Published

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On July 11, the Payment Services Regulations 2012 were published. SI 2012/1791. The Regulations address a concern that unfit persons may currently establish or manage a small payment institution. They amend the Money Laundering Regulations 2007 (MLRs) and the Payment Services Regulations 2009 (PSRs).

The Regulations will, among other things:

  • Give the FSA the power to check that the owners and managers of small payment institutions are fit and proper persons, and that the directors and managers of such businesses are of good repute and possess the necessary knowledge and experience.
  • Give HMRC the power to strike a business off the register of money service businesses under the MLRs, if the business is providing, or is purporting to provide, a payment service, when it is not registered or authorised to do so by the FSA.

They come into force on October 1 (with the exception of the regulations relating to the consequential amendments).