A Guide to Anti-Money Laundering for Crypto Firms
Is your business ready for the changes coming with 4MLD?
The UK government is in the process of transposing 4MLD into UK legislation via the Money Laundering and Transfer of Funds (Information on the Payee) Regulation 2017, which will come into effect by 26th June 2017.
To ensure that UK regulated industries are up to date with their AML obligations, the FCA must issue new guidance which is in line with the new regulations. The FCA issued a consultation on the guidance for PEPs in March 2017, this was an opportunity for UK businesses to make comments on the new guidance. The consultation will be open until the 18th April and the finalized guidance will be published in June.
The only substantial difference between the existing legislation (2007 Money Laundering Regulations) and the new consultation is the expansion in scope of the regulation to include domestic as well as international PEPs. The definitions of what constitutes a PEP remains the same with the following minor change:
- 2.15 PEP family members can remain PEPs even after the original PEP has left office if they themselves pose a known risk
The changes to the guidance on when companies must carry out EDD or establish a source of wealth are as follows:
- 2.17 Clarification on what constitutes a low risk indicator
- 2.18 Clarification on what constitutes a high risk indicator
- 2.19/.20 Clarification on what constitutes a high/low risk close associate/family member of a PEP
- 2.23 Clarification on the extent of public information that should be taken into account
- 2.24/.25 Clarification on what measures a firm should take in high/low risk situations
What does this mean for UK businesses?
The most significant change is the change in scope of the PEP regulation to include domestic PEPs. To remain compliant companies should make sure that their PEP data provider has all the necessary information on domestic PEPs, their relatives and close associates. ComplyAdvantage has comprehensive data on all UK domestic PEPs in our database, ensuring that our clients will be fully compliant with 4MLD.
For more information on how ComplyAdvantage can get you ready for 4MLD contact us today.
Originally published March 20, 2017, updated November 17, 2021
Disclaimer: This is for general information only. The information presented does not constitute legal advice. ComplyAdvantage accepts no responsibility for any information contained herein and disclaims and excludes any liability in respect of the contents or for action taken based on this information.
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