Summary of the Regulated Sector

Customers may have a solicitor to advise with their legal affairs, they have a bank account, a mortgage and a credit card. They may have some sort of hire purchase or a car loan. They may invest in a pension fund or buy shares for investment purposes. These transactions will more than likely be transacted through a number of different institutions for which your business may be one.

Some sectors are at a higher risk than others, for example banking, bureau de change and money transmitters could actually handle and process transactions that contain the physical proceeds of crime. In contrast solicitors and accountants do not usually handle clients’ monies but are more likely to become involved in schemes to legitimise clients’ affairs.  Yet the client account facilities of these type of firms are an attractive target to a money launderer.

This highlights that our customers’ affairs are being looked at by many different entities at different times which have a different type of relationship with the customer. This can mean many entities guarding against the unusual or suspicious activity in the customers affairs from different perspectives and at different times. This is one of the strengths of the anti-money laundering regime.

Section 2: Self assessment. You should have grasped an understanding of the Regulated Sector.

  1. Do you know the types of activities included in the UK Regulated sector?
  2. Do you understand about potential links between these activities to customer behaviour?
  3. Do you understand why the activities of your particular firm are within the regulated sector?