A new set of anti money laundering guides have been published on the HMRC internet site to replace Public Notice MLR8: Preventing money laundering and terrorist financing. The new guides are sector specific and provide detailed guidance in relation to the legislation, risks, record keeping and reporting requirements relevant to each business sector.

The new guides will be available on-line only. This follows on from HMRC’s announcement on 12 April 2010 that they would stop sending printed copies of Public Notice MLR8 to businesses we supervise and publish MLR8 on the internet only. All relevant businesses should now refer to the internet when they need to check anti money laundering guidance. Printed copies of the current Public Notice MLR8 Preventing money laundering and terrorist financing dated August 2008 have now been withdrawn.

The new anti money laundering guides are as follows:

• Anti money laundering guidance for Money Service Businesses
• Anti money laundering guidance for High Value Dealers
• Anti money laundering guidance for Trust or Company Service Providers

The guidance should make it easier for businesses to understand what is required of them under the Money Laundering Regulations and other legislation.

Money Service Businesses (MSBs) should note that the Counter-Terrorism Act guidance has been incorporated into the ‘Anti money laundering guidance for Money Service Businesses’ this is available at Appendix 7 of the guidance. This will assist them in complying with the terms of a direction which is a legal requirement.

MSBs should also be aware that guidance for E-money issuers will be incorporated and published in the new guidance shortly.

High Value Dealers should note that guidance on proliferation financing risks will be incorporated and published in the anti money laundering guidance for High Value Dealers shortly.

Accountancy Service Providers (ASPs) should continue to refer to the Consultative Committee of Accountancy Bodies (CCAB) guidance. HMRC are considering whether they can provide specific sectorial advice for Accountancy Service Providers on their Money Laundering Regulations website.

This would be a welcome move. Most professional bodies have already written simpler guidance than the CCAB, for the members they supervise and many will be aiming for HM Treasury approval for them. It would not seem wise to leave those in most need of simplified sector guidance with only the complex CCAB guidance to reply upon.

In mid June HMRC a paper, which went to some length to describe the activity of the HMRC supervisory team and publish various statistics.

HMRC now state that between the four sectors they have responsibility for supervision they now have over 18,000 registered firms, of which just over 14,000 are accountancy service providers (ASP’s) or trust and company service providers (TCSP’s).

HMRC has not yet, in any force, started compliance visits to either TCSP’s or ASP’s, so therefore there compliance visits have been focused upon the remaining 6,000 money service businesses and high value dealers.

In just the eight month period between September 2009 and April 2010 HMRC compliance officers carried out 908 visits to businesses, this is a tremendous figure, with almost 15% of all firms having a visit in that period. This rate of supervision has to be commended; however, unless the rate must fall considering the sheer volume of ASP’s that must come under the supervision of HMRC.

The other interesting statistic to come from these visits was that 193 warning letters were issued, which is just over 21% of the firms visited. If you look at it from the opposite point of view, almost 80% of businesses visited had made good attempts at coping with aml compliance. That has to be good news.

HMRC Publish Money Laundering Regulations Memorandum Trading Account

The Money Laundering Regulations supervisory regime is run on a cost recovery basis and the fees paid by customers cover the expense of running the operation. HMRC costs include registering new businesses, contacting and visiting businesses, running an effective risk system, maintaining the register and producing guidance and information for customers.

This account summarises the resources that have been applied and generated in providing services and managing the HM Revenue & Customs (HMRC) Money Laundering Regulations supervisory regime for the year ending 31 March 2009. The figures are consistent with the HMRC 2008-09 Resource Accounts prepared in accordance with UK GAAP.

Notes: The £1,496,564 deficit for the year results from a large fee being challenged. HMRC have not included the amount under challenge within the above figures to maintain consistency with audited HMRC figures. However, HMRC have issued a statement of demand for the amount and are pursuing payment during 2009-10.

The annual fee for businesses registered under the Money Laundering Regulations 2007 will remain at £120 per premise for the year 2010 – 2011. HMRC are pleased to be able to provide early confirmation of next year’s fee level as they are aware that many larger businesses appreciate as much notice as possible to help in their financial planning.

Introduced in 2002, the fee was initially set at £100, and was subsequently reduced to £60 from June 2003. There were no changes until 1 June 2007, when the fee was increased to £95; this level was maintained in 2008, and increased to £120 in 2009.