Reforming the AML/CTF supervisory system
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HM Treasury has published a consultation on reform of the anti-money laundering and counter-terrorism financing (AML/CTF) supervisory system, in line with a commitment in the Economic Crime Plan 2023-6. Money laundering and terrorism financing cause harm to the UK’s population and allow abuse of its economy by malign actors.
Currently, the AML/CTF supervisory system is made up of three statutory supervisors - the Financial Conduct Authority, the Gambling Commission and HMRC - and 22 professional body supervisors (PBSs) who supervise the legal and accountancy sectors. These supervisors ensure firms and individuals comply with the Money Laundering Regulations (MLRs). They take enforcement actions if the MLRs are breached and ensure only fit and competent individuals hold management roles in regulated businesses.
The 2022 Review of the UK’s AML/CTF regulatory and supervisory regime concluded that while there had been continued improvement to the regime, some weaknesses in supervision may need to be addressed through structural reform. The Review set out four possible models for a future AML/ CTF supervisory system. This consultation further develops these four models, assessing them against three consultation objectives. The consultation does not include a policy preference and invites respondents’ views regarding the potential benefits and disbenefits of each potential reform model.
Additionally, we are seeking views on whether to expand requirements on supervisors and their regulated populations relating to sanctions compliance.