Among the announcements relevant to regulated financial services in Jeremy Hunt’s budget are: a bizarre U-turn to reinstate the previous eligibility criteria for high net worth and sophisticated investors, when...
Category - Financial Crime Prevention
Emma RadmoreGovernment reviews SAMLA
The FCDO has carried out a preliminary post-legislative assessment of SAMLA 2018. The analysis looks at the background to the legislation and sets out the powers it contains. It is divided into sections, focusing mainly...
FCA warns Annex I firms on AML issues
FCA has written to CEOs of the 1,000 Annex I firms it supervises (firms which do not need FSMA authorisation but which carry on activities subject to the MLRs for which FCA is the appropriate supervisor). It has carried...
FCA pauses civil action to pursue criminal investigation
FCA has secured a 12-month pause in its civil case over regulatory breaches against John Dance and WealthTek LLP to allow it to focus its efforts on its investigation into possible criminal offences of fraud and money...
FCA creates new market intelligence pages
FCA has created new pages on its website looking at:
market observations it has received and
STORs it has received
The pages currently contain the figures for 2023.
FATF consults on payments transparency recommendations
The Financial Action Taskforce (FATF) has published a consultation, and explanatory memorandum, on proposed changes to its recommendation 16 (the Recommendation) and the associated interpretive note and glossary terms. ...
Duncan ScottPSR speaks on progress in fraud reimbursement
Chris Hemsley has spoken at the Fraud Leaders’ summit. He looked at how the APP fraud reimbursement rules are critical to address the increasing number of frauds that take place through payments that use the FPS...
FMSB publishes onboarding standard
The Financial Markets Standards Board has published a draft standard which would apply to firms onboarding clients or reviewing client files for UK AML and KYC compliance. The standard would apply to FMSB members in all...
SFO speaks on faster case resolution
Nick Ephgrave, SFO Director, has spoken on SFO’s history and his plans for the future. He wants to solve cases more quickly, and spoke of a number of tactics he plans to use. These include a more rigorous and...
OFSI updates guidance
OFSI has updated its guidance on financial sanctions and licensing to include detail on licensing principles and framework in the general guidance section of its main guidance, and to move its travel guidance to a...
High risk third country list update
Treasury has updated its website to reflect the list of high risk third countries for MLR purposes. The list now comes directly from FATF. Following FATF’s plenary meeting on 23 February, it has removed Barbados...
Fair Business Banking Group reports on de-banking
The All Party Parliamentary Group on Fair Business Banking has reported on de-banking. The report looked at why banks have been refusing or withdrawing banking facilities giving reasons that customers felt were at best...
Illegal money lender jailed for failing to pay confiscation order
FCA has issued a press release highlighting the nearly 8 year prison sentence handed down to Dharam Prakash Gopee by the City of London Magistrates’ Court for wilfully refusing to adhere to a confiscation order...
OFSI publishes ransomware guidance
OFSI has published financial sanctions guidance for ransomware. The guidance explains that the government uses the financial sanctions regime to target the ransomware threat actors who cause the highest harm to the UK...
Market Watch focuses on organised crime
The latest edition of FCA’s Market Watch looks at actions firms can take to mitigate the risks of being used by Organised Crime Groups. It says suspicious trading by members of OCGs forms a large proportion of the...
OFSI updates guidance
2024 will see OFSI move to digital guidance which it says will enhance accessibility and user experience. It will not be making fundamental content changes as it starts to make the changes. As a start, it has updated...
Home Office responds on SARs regime review
The Home Office has published its response to the 2019 Law Commission report and recommendations on the SARs regime. The report had made 19 recommendations, of which the Home Office accepts 13. The uncontended...
HMRC updates MSB guidance
HMRC has updated its AML guidance for money service businesses. The guidance is dated May 2023 and has just been approved by Treasury.
Tribunal backs FCA on EMI
The Upper Tribunal has agreed not to suspend the restrictions FCA placed on EMI Nvayo Limited last year. The wide restrictions stop the firm carrying on EMR business or disposing of assets. FCA welcomed the decision...
FCA updates on reducing and preventing financial crime
FCA is now half way through its 3 year strategy on reducing and preventing financial crime, and has summarised its work over the last 18 months. It notes that: when it set its strategy, there was no national plan (the...
FCA publishes blockchain research
FCA has published a research note entitled ‘Review of Maximal Extractable value (MEV) and Blockchain Oracles’ in collaboration with Futuresight Business Intelligence Ltd, the Financial Industry Regulatory...
HMRC publishes details of live FTP tax evasion offences under investigation
HMRC has published details of the number of live corporate criminal offences (CCO) for the failure to prevent tax evasion under investigation as at 1 January 2024. HMRC has 35 potential cases underway, including: 11...
CPI 2023 shows poor performance from top countries
Transparency International’s Corruption Perception Index for 2023 makes for worrying reading – particularly in relation to countries which score best. TI notes that only Ireland and the Seychelles have...
PSR heralds priorities for 2024
Chris Helmsley has looked ahead to a busy year ahead for payments. He spoke on: implementation of the mandatory APP reimbursement rules which will be a real step-change in the way the industry approaches fraud...
FCA takes criminal proceedings for unauthorised activities
FCA has started criminal proceedings against an individual who persuaded over 200 investors to invest £19m in an investment scheme. It alleges that Guy Flintham made several fraudulent claims about the scheme and...
ML High Risk countries re-defined
From 22 January, a change to the MLRs means that Treasury will no longer periodically update Schedule 3ZA to the MLRs. The definition of “High risk third country” is now a country named on the FATF lists of...
Corporate Transparency and Companies House – 2024 changes
We’ve written this article on the changes to the role of Companies House in improving corporate transparency under the EECTA from March.
Suzanne GadoEU Council and Parliament progress AML proposals
The EU Council and Parliament have reached agreement on the new EU AML package which will, among other things: extend the concept of “obliged entity” to cover most of the crypto sector and also (from 2029)...
Home Office publishes DAML exemption guidance
The Home Office has published guidance on money laundering reporting obligations in relation to the DAML exemption provisions the ECCTA has introduced. Before the ECCTA took effect, the threshold amount below which...
OFSI updates guidance
OFSI has updated several pieces of guidance. There are December 2023 versions of: general guidance on financial sanctions; guidance on enforcement and financial penalties; and guidance specific to the Russian sanctions...
OFSI updates on Russian correspondent banking restrictions
OFSI has published an update summarising the impact of the changes to the Russian sanctions regulations that took effect from 15 December 2023. The changes mean that a bank cannot process any payment that has...
FCA reflects on 2023
Nikhil Rathi has reflected on some of FCA’s key achievements and milestones from 2023. He highlighted: the implementation of the Consumer Duty and changes firms have already made as a result; FCA telling GAP...
Regulators publish 2023 cyber findings
The BoE, PRA and FCA have published their latest annual CBEST thematic report. The report, which has been published in full for the first time, contains cyber resilience good practice, lessons learned and insight...
PSR publishes final APP fraud reimbursement details
PSR has made all its policy decisions and published details of the full APP fraud reimbursement regime which will take effect on 7 October 2024. It has confirmed: the upper claim limit will be £415,000 to match the FOS...
Treasury review of international sanctions Regs
Treasury has published the results of an independent review on the operation of the Counter Terrorism (International Sanctions) (EU Exit) Regulations 2019. The review looks at the purpose of the Regulations and the...
MLR changes address domestic PEPs
Changes to the MLRs will take effect from 10 January 2024, which meet the requirements of s77 FSMA 2023 and provide that the starting point for EDD assessments where a customer is a domestic PEP or is a family member or...
New Russian sanctions take effect
The Government has introduced a new set of financial and trade sanctions against Russia. Taking effect from 14 December, the package includes broadening the existing sanctions in respect of correspondent banking and...
OFSI publishes Annual Review
OFSI has published its annual review for 2022-23. The review looks at how OFSI has expanded to meet its increased workload and how it has transformed its practices to deliver more effective implementation and...
Government creates OTSI to clamp down on Russian sanctions breaches
A new “Office of Trade Sanctions Implementation” will act to strengthen enforcement on companies that are evading Russian sanctions. Following recent announcements, one of its jobs will be to look at...
NCA warns of circumvention tactics on Russian sanctions
NCA has issued an alert warning financial and other businesses that Russia is trying to procure UK sanctioned goods through intermediary countries, but using complex supply chains and routes. The UK, with the US, EU and...
PSR publishes cycle 2 APP fraud reporting guidance
PSR has published its finalised reporting guidance for firms required to provide it with APP scam data, the second batch of which will cover the calendar year 2023. This cycle will be a 12 month report, rather than the...
IRSG highlights importance of transparent beneficial ownership
The International Regulatory Strategy group has published a report which makes 7 recommendations around how a globally transparent and effective beneficial ownership regime can be achieved. The recommendations focus on...
PSR speaks on preparing for APP scam reimbursement
Chris Hemsley has spoken of the preparatory work that both sending and receiving PSPs should be doing ahead of the mandatory reimbursement requirement for APP frauds coming into effect next year. The new rules will mean...
Treasury updates AML list of high-risk countries
Treasury has made the second set of amendments this year to its list of high-risk countries for AML/CTF purposes. The updated schedule was made on 4 December and took effect on 5 December. The changes mean that...
MoU between FCA and OFSI
On 1 December 2023,FCA published a Memorandum of Understanding (MoU) (dated 21 November 2023) between it and OFSI. The MoU sets out the collaboration and information exchange between FCA and OFSI. It replaces the...
FIN. TeamOFSI defends licence refusal
The High Court has supported OFSI’s decision to refuse to grant licence requests relating to a Designated Person. Mikhail Fridman had filed the first claim under s38(2) of SAMLA (and also the first challenge to...
FCDO and OFSI clarify “control”
FCDO and OFSI have given guidance on their approach to what “ownership and control” means when a public official is designated. The guidance confirms that any entity which is owned or controlled by a...
ECCTA starts to take effect
The first commencement order under the Economic Crime and Corporate Transparency Act 2023 brings into force on 15 January 2024 several parts of the Act, including the provisions on: the change to POCA to create...
SAR reporter booklet highlights recent cases
The November edition of NCA’s SARs Reporter Booklet summarises the outcome of several DAMLs which led to further enforcement action for fraud, money laundering and in raising safeguarding concerns about a...
Basel Committee publishes discussion paper on digital fraud
The Basel Committee on Banking Supervision has issued a discussion paper on digital fraud and banking. The paper is a high-level assessment of the supervisory and financial stability implications of digital fraud for...
Vida FatemiNCA issues gold sanctions abuse warning
NCA has warned financial institutions to be aware of deliberate attempts to breach UK sanctions and launder sanctioned gold and hide it in supply chains. Several individuals and entities operating in and supporting...
FCA portfolio letter to wealth managers and stockbrokers
FCA has published its Dear CEO letter to wealth management and stockbroker firms setting out its supervisory priorities and expectations for the sector. The letter focuses on financial crime prevention and Consumer Duty...
FCA calls for better treatment of fraud victims
FCA has carried out a review of firms’ fraud controls and complaints handling, and is disappointed with the way some firms support fraud victims. While it did find some examples of good practice, it found many...
PSR releases first APP scam performance figures
PSR has released figures showing how the largest 14 banking groups performed during 2022 in tackling APP scams and reimbursing victims. The data covers 95% of payments made via Faster Payments. PSR had collected data...
Market Watch updates on market soundings
The latest edition of Market Watch updates FCA’s views on market soundings, following on from previous editions. FCA says it has recently found cases where recipients of soundings have traded between receiving the...
FATF holds plenary
FATF has held its latest plenary session. It agreed several reports, including on crowdfunding for terrorist financing, and revisions to Recommendation 8 to clarify measures applying to NPOs. It will also be consulting...
Lords gives way on FTP… and Bill gets Royal Assent
The saga of the debate on scope of the proposed new failure to prevent fraud offence. The Commons (Kevin Hollinrake, Under-Secretary of State for Business and Trade) urged both houses not to “risk the safe...
PSR publishes APP fraud data guide
PSR has published guidance for PSPs on the content of the data on APP fraud that PSPs are now required to provide. The guide also looks at the required format for the data and the timescales for its provision.
Wolfsberg Group updates payment transparency standards
The Wolfsberg Group has replaced its Payment Transparency Standards originally drafted in 2017 with a new set of standards designed to reflect the operational and financial crime risks posed by innovation in payment...
FCA publishes money mule prevention review
FCA has published the findings from its views of the adequacy of PSP systems and controls against money mule activity. As now seems to be standard, it found that some firms are using innovative solutions such as facial...
Lords continue to battle on FTP fraud
The ping pong between the Houses on the scope of the proposed failure to prevent fraud offence continues. In the debate on 18 October, the Government continued to refuse to give way on its belief that it is...
FCA updates on skilled persons reports
FCA has published the numbers of skilled persons reports commissioned in the first two quarters of 2023: From April to June it commissioned 11 reports, of which 4 related to retail investments and 3 to wholesale...
JROC welcomes OBL data collection frameworks
The Joint Regulatory Oversight Committee has welcomed the publication of two data collection frameworks by Open Banking Limited, one on levelling up availability and performance and the other on mitigating the risks of...
JMLSG finalises discrepancy reporting changes
JMLSG has published the final version of its changes to Chapter 5 of Part 1 in relation to discrepancy reporting, and has submitted them to Treasury for approval.
FCA fines Equifax £11m for cyber-security breach failings
FCA has fined Equifax Ltd for £11,164,400 for failing to manage and monitor the security of UK consumer data it had outsourced to its US parent, in breach of Principles 3, 6 and 7. In 2017, cyber-hackers caused Equifax...
Emma RadmoreSFO investigates funeral plan provider
SFO has written to authorised firms asking for information to help its criminal investigation into suspected fraud by a pre-paid funeral planner, Safe Hands Plans Limited and its parent company. Nearly 50,000 plan...
FCA stops firm from approving crypto promotions
On 10 October, FCA imposed restrictions on rebuildingsociety.com Ltd to stop it from approving crypto financial promotions. The firm, which is authorised to operate an electronic system in relation to lending, was also...
FCA updates crypto application stats
FCA has updated the statistics on applications for registration by crypto firms, and its feedback on good and poor applications. As at 1 October, it had received 326 applications since registration began in January...
FCA issues first alerts under new crypto marketing regime
FCA has issued 146 alerts about financial promotions in the first 24 hours of the new crypto marketing regime. These alerts contain the names of companies which may be illegally communicating cryptoasset promotions. The...
FCA fines broker for fin crime control failings
FCA has fined ADM Investor Services International Limited, an investment broker, nearly £6.5m for inadequate AML systems and controls. The firm’s business model made it subject to high risks of money laundering...
OFSI publishes Correspondent Banking General Licence
OFSI has published a general licence for correspondent banking payments. The licence permits certain payments to be made in respect of sanctions imposed under the Russian and Belarussian sanctions regimes. It allows...
PSR consults on FPS reimbursement Direction
PSR is consulting, as promised, on a Specific Direction on FPS participants which will underpin the faster payments reimbursement rules and will require participants to follow the rules and reimburse APP scam victims in...
UK Finance respond to ban on cold calling
UK Finance has responded to HM Treasury’s proposals to ban cold calling in financial services and is supportive of the proposals. The measures aim to protect consumers, particularly elderly and vulnerable...
FCA and CoLC launch APP scam project tool
FCA and the City of London Corporation have launched the promised APP synthetic dataset which is designed to develop products and services to minimise fraud. The dataset will allow analysis of rare patterns of behaviour...
Lords may compromise further on FTP fraud
A motion to be moved when the Lords next considers the Economic Crime and Corporate Transparency Bill will propose a further compromise with the Commons by exempting from the offence newly defined “small”...
FCA issues final warning on crypto promotions
FCA has published a final warning to crypto firms stressing the breadth of the definition of “financial promotion” and how it will affect crypto promotions going forwards. The communication is aimed at...
JMLSG travel rule guidance approved
Treasury has approved the addition to the JMLSG Guidance that provides guidance on implementation of the travel rule for crypto business. An updated Sector 22 and its annex are now approved.
UK Finance comments on account access and closure
UK Finance has commented on FCA’s report on account access and closure – noting that the main reason for account closure is not because of political beliefs or other lawfully held views, but because of...
FCA reports on bank account access and closures
FCA has published its initial findings in its review of bank account access and closures. It has based its conclusions on information provided for the year to June 2023 by 34 firms. The key conclusion is that no firm...
Lords urges Government to change stance on FTP
The “failure to prevent fraud” provisions in the Economic Crime and Corporate Transparency Bill continue through parliamentary “ping pong”. On 11 September, the Lords again rejected the...
OFSI publishes frozen assets reporting requirements for 2023
Treasury has published a notice requiring firms to report any new, or changes in previously held, frozen assets, to OFSI by 10 November 2023.
SFO speaks on new powers
Michelle Crotty, Chief Capability Officer at the SFO, has spoken on its successes since Lisa Osofsky became its Director and looking ahead to Nick Ephgrave’s upcoming tenure. She also noted the increased powers...
Economic Crime and Corporate Transparency Bill back in Lords
As expected, when the Economic Crime and Corporate Transparency Bill was discussed in the Commons on 4 September, it disagreed with some of the Lords’ amendments, so the Bill has been returned to the Lords for...
FCA speaks on financial crime controls
Sarah Pritchard has spoken on the importance of firms calibrating their financial crime fighting systems to the right level. She stressed the importance of firms understanding who their clients are, identifying the...
FCA publishes Russian sanctions controls results
FCA has published the key findings, and examples of good and poor practice, following its assessment of the sanctions systems and controls firms have in place specifically in relation to the increased sanctions...
FCA launches PEP review
FCA has published a paper setting out the issues it will consider as part of its review on the treatment of PEPs under s78 FSMA 2023. FCA notes that it does not have the power to change the law relating to the PEPs...
OFSI uses disclosure power for first time
OFSI has used its disclosure enforcement power for the first time to highlight a breach of the Russia (Sanctions) EU Exit Regulations 2019. This power allows OFSI to publish notices of breaches where it has decided not...
JMLSG publishes crypto transfer guidance
JMLSG has published its final revisions to Section 22 (Cryptoasset providers and custodian wallet providers) in Part II of its AML/CTF guidance. The update includes a new Annex 1 on crypto transfers which relates to the...
FCA sets out expectations for travel rule compliance
FCA has set out its expectations for UK cryptoasset businesses subject to the so-called ‘travel rule’, which will require them to collect, verify and share information about cryptoasset transfers from 1...
Laura WilesPSR consults on APP fraud reimbursement limit and consumer standard of caution
PSR has launched two consultations relating to the implementation of its new APP fraud reimbursement requirements, which mean that the vast majority of victims will be reimbursed within 5 days of the fraud being...
FCA invites PEPs to share their experiences with financial services firms
FCA is currently reviewing how financial services firms have applied the PEPs regime and whether changes to its guidance is required. It has now written a letter to PEPs directly inviting them to share their...
FCA and COLC to hold APP data launch briefing
FCA and the City of London Corporation will hold an event on 27 September to launch FCA’s APP fraud synthetic dataset. At the event, FCA will introduce the dataset and share details of the engagement behind it...
UK Finance updates FTR guidance
UK Finance has published a “how to” interpretative guide to the Funds Transfer Regulation. The FTR was one of the pieces of legislation onshored after Brexit, and UK Finance had previously produced guidance...
FCA warns consumers on loan fee fraud
FCA has issued a consumer warning to help customers avoid loan fee fraud as they look to cover the costs of summer spending. This type of fraud, which involves customers paying for a loan they never receive, typically...
Government consults on financial product cold call ban
The Government is consulting on how to ban cold calls offering any financial products. It says that once the ban is in force, it will be clear to anyone receiving a call for a financial product that the call is a scam...
JMLSG finalises change to impersonation fraud mitigation
JMLSG has submitted for ministerial approval a change to Paragraph 5.3.89 in Part I of its guidance. The change relates to additional measures firms should consider taking when identity is verified electronically, copy...
HMRC updates MLR registration guidance
HMRC has updated its guidance for firms needing to make changes to their money laundering registrations or deregistering their business. The guidance summarises what changes should be reported to HMRC and notes that any...
JMLSG consults on travel rule
JMLSG is consulting on changes to its guidance in respect of the travel rule for cryptoasset transfers. The changes will add a new Annex 1 to Chapter 22 in Part 2 and will reflect the requirements in Part 7A of the MLRs...
OFSI updates sanctions guidance
The latest update to OFSI’s guidance on complying with the financial sanctions regime focuses on updates to the licensing process.
PRA fines Credit Suisse record £87m for risk management and governance failures
PRA has imposed a record fine of £87m on Credit Suisse for serious risk management and governance failures between 1 January 2020 and 31 March 2021 in connection with its exposures to Archegos Capital Management. This...