View more on these topics

Preparing for the new anti-money laundering rules

Expect final FCA guidance later this month on the Fourth Money Laundering directive, as well as updates from the Treasury


Get ready for the Fourth Money Laundering Directive, which has significant consequences for all regulated firms. You can look forward to:

• A requirement for firms to take appropriate steps to identify and assess the risks of money laundering and terrorist financing to their business. Firms will be required to document these risk assessments and keep them up-to- date

Assessments will also need to be made available to the FCA on request. The FCA is  contacting a selection of small firms to conduct assessments of their anti-money laundering and financial sanctions systems and controls against the prevailing standards. This work is likely to continue once 4MLD is in place

• A revised definition for politically exposed persons to formally include individuals entrusted with prominent public functions based in the UK. A risk-based approach to the treatment of politically exposed persons and their family members is encouraged

• Beefed-up guidance on when and how to assess the identity, address and source of funds of existing clients

• Extinction of “simplified due diligence” except where the firm has first established that the business relationship or transaction presents a lower degree of risk of money laundering occurring.

• Clarification on how to handle clients in high-risk countries

Expect finalised FCA guidance this month, followed by updates from the Treasury and the Joint Money Laundering Steering Group, which should enable firms to update procedures in line with the new requirements. 

Identity and address verification is only one part of the anti-financial crime framework. Staff awareness and diligent fact finding are essential. Add all this to your summer holiday reading list.

Phil Young is managing director at Threesixty 



FCA ramps up financial crime reporting

The FCA is stepping up its oversight of financial crime by requiring large firms to file financial crime reports. Advisers and investment firms with revenue below £5m will be exempt from filing the return. The first returns will be due in late March 2017. In a policy statement released today, the FCA says the returns, […]


FCA fines Barclays £72m over financial crime risk failures

Barclays has been fined £72m by the FCA for failing to minimise the risk the bank could be used to facilitate crime. It is the largest fine ever imposed by the regulator, or its predecessor, for financial crime failings. The failings relate to a £1.88bn transaction the bank arranged for ultra-high network clients in 2011 […]

Vanguard launches D2C investment platform

Vanguard launches D2C platform in the UK with fees at 0.15 per cent Vanguard, one of the world’s largest fund groups, has launched its direct-to-consumer online platform for the UK mass-market investors. In October, Money Marketing first revealed Vanguard’s plans to launch the service as part of a “10-year plus strategy”. The new platform will […]


News and expert analysis straight to your inbox

Sign up


There are 2 comments at the moment, we would love to hear your opinion too.

  1. Finian Manson 5th June 2017 at 1:37 pm

    “A revised definition for politically exposed persons to formally include individuals entrusted with prominent public functions based in the UK. A risk-based approach to the treatment of politically exposed persons and their family members is encouraged”

    I look forward to the squawks from politicians and their families when their transactions are subject to the same scrutiny and delay as the rest of us!

  2. Nicholas Pleasure 26th June 2017 at 12:09 pm

    I wonder if there are any statistics that show whether the existing regime has been at all successful in combating money laundering through IFAs?

    My view is that small IFA’s are the least risky as we know our clients personally.

    Whilst proving identity can be very difficult for an older person who never drives or travels I am sure that most criminals would be able to source documents that would be good enough to convince the average IFA.

    It doesn’t help that the passport and driving licence design receives continuous and regular updates so spotting a fake is very difficult without significant training.

Leave a comment