Who Must Firms Register with for Anti-Money Laundering Purposes?

Combatting money laundering doesn’t just take one purpose-made team, it is the responsibility of the entire economic network to recognise and report such behaviour. Therefore, the UK has set up a specific framework to tackle money laundering, with businesses having to register with the necessary regulatory bodies to ensure compliance. So, if you want to know who must register with for anti-money laundering purposes, this blog will give you all the answers you’re looking for. 

Making the process utterly seamless for businesses of all sizes, at SmartSearch, we offer an AML and compliance platform that allows you to conduct everything from robust KYC checks to sanctions and PEP screenings and much more. Specialists in our field, our comprehensively built platform streamlines your AML responsibilities, making it simple to register with the right regulatory bodies and carry out your due diligence.  

But before you reach out to us to change your approach to AML responsibilities, let’s delve into the specifics of registering with the right regulatory authorities. 

What Are AML Checks?

Let’s start by setting a basic understanding of AML. Standing for anti-money laundering checks, AML checks are measures that are put in place by the government to help prevent illicit economic practices from taking place. These AML checks depend on your sector and the nature of your customers, but generally, the process involves customer verification checks, transaction monitoring solutions and suspicious activity reports, if necessary. 

Why Are AML Checks Important? 

Money laundering is estimated to cost the UK economy approximately £100 billion every year, according to the Economic Crime and Corporate Transparency Act, therefore combatting it should be in the interest of each and every taxpayer. But, as well as protecting the integrity of the country’s economy from money laundering and terrorist financing, AML checks also protect your business from legal and reputational damage, demonstrating your trust and integrity to authorities and customers. 

What is AML Registration?

AML registration is the simple process of registering your company with a supervisory authority in order to demonstrate your compliance with anti-money laundering regulations. Registration with the relevant authorities is mandatory for particular businesses in the financial sector and ensures that they have the appropriate policies in place to mitigate the risk of money laundering and are audited for compliance by a professional body. 

Which Businesses Need to Register for AML?

Wondering who needs to register for money laundering supervision? AML regulations apply to several different business sectors, including, but not limited to, accountants, solicitors and estate agents. While there is no single hard and fast rule for who needs to register for AML supervision, if your business takes part in any of the following activities, it’s a legal requirement to sign up:  

• Accountancy services
• Legal services
• Estate agency or letting agency work
• Tax advice
• Financial institutions
• Gaming operators 
• Cryptocurrency providers 
• FTrust or company service providers
• High-value goods or art dealers

Which AML Authorities Do Businesses Need to Register With? 

While organisations often know that they need to register with AML authorities, it is not always clear which ones they need to register with. To make things simple, we’ve explained the three authorities below: HMRC, the FCA and the Gambling Commission.

HMRC

Taxpayers in the UK will be very familiar with His Majesty's Revenue & Customs (HMRC) since this is the country’s tax authority. As well as their responsibility for collecting taxes, HMRC also carries out anti-money laundering supervision, specifically for non financial businesses that handle high-risk transaction and financial activities. This supervision ensures companies are carrying out their AML due diligence, including regular monitoring, audits and more.  

Companies that need to register with HMRC for AML purposes include: 

• Estate and letting agents
• Accountancy service providers
• Trust or company service providers
• High-value goods or art dealers
• Bill payment providers

How to Register With HMRC

Registering with HMRC for AML purposes is made as simple as possible for businesses. By following the following steps, you can easily set yourself up. 

• Create a Government Gateway Account (you should already have one if you’re a registered UK business). 

• Visit the HMRC AML Registration page.

• Complete the application form, including any relevant AML policies. 

• Pay the registration fee (this will vary depending on your business).

• Await approval or further feedback from HMRC.

The FCA

Who must firms register with for anti-money laundering purposes? More often than not, for companies in the financial sector, the FCA will be the answer. The Financial Conduct Authority (FCA) is an independent financial services regulator that protects the integrity of the UK economy. Supervising financial organisations under AML regulations, the FCA will conduct audits and reports and will prosecute businesses for breaches and a lack of due diligence. 

Businesses that need to register with the FCA include: 

• Banks and building societies
• Mortgage providers 
• Financial advisers and wealth managers 
• Some credit advisors
• Cryptocurrency providers

How to Register With the FCA

Registering with the FCA is a similar process to HMRC, with business operators required to follow these steps:

• Create an account on the FCA’s Connect system (if you haven’t already done so).

• Complete an AML Registration application, including AML policy documents, governance structure and financial forecasts.   

• Pay the application fee (this will vary depending on the size of your business).

• Await feedback or acceptance from the FCA - this step can take several months. 

The Gambling Commission 

As the name suggests, The Gambling Commission is an independent regulator for the gambling industry. This makes them responsible for the licensing and regulation of all businesses in this sector. Their responsibilities include enforcing AML obligations, making sure that operators are helping to prevent financial crime, and providing AML guidelines to help businesses to do so. By extension, they also require risk assessments from the relevant firms and take regulatory action where appropriate. 

You need to register with the Gambling Commission for AML purposes if you operate a:

• Casino (either physical or online)
• Betting shop 
• Bingo Hall 
• Lottery organisations 
• General gambling business offering services to UK customers

How to Register With The Gambling Commission

Signing up with The Gambling Commission is a little simpler than HMRC and the FCA as registration is integrated into the operating licence process.

• Register for a gambling operating licence through the Gambling Commission’s eServices portal. 

• During this application, organisations must provide an AML risk assessment. documentation, AML policies and evidence of relevant training. 

• Pay the enrollment fee (this will vary from business to business).

• Wait for approval. AML assessments will be arranged as part of the approval process. 

Consequences of Not Registering With an AML Body

The consequences of not registering your company with the relevant AML body will depend on the severity of your specific actions. For minor flouting of the rules, HMRC may impose financial penalties, but this fine will vary dramatically depending on the seriousness of your offence, the compliance history of your business and the reason for non-compliance. In addition, HMRC may publish details of your company’s lack of due diligence, demonstrating to business partners and customers that you might not be trusted. 

But, avoiding AML penalties is simple, particularly if you partner with SmartSearch. We make fulfilling your due diligence responsibilities easy, providing you with an online toolkit that makes conducting KYB checks, enhanced due diligence screenings and more utterly effortless. Our platform can be easily integrated into your current deck of digital platforms, too, making compliance as seamless as possible. 

Book a free demo now to discover what our platform feels like hands-on, or contact us to find out how we can help you!