CP20/17: Extension of Annual Financial Crime Reporting Obligation

Consultation closed
Policy Statement
Q1 2021
Q1 2021

We are considering extending the scope of our annual financial crime reporting obligation to include firms that carry on regulated activities that potentially pose a higher money laundering risk.

Read CP20/17

Why we are consulting

Our annual financial crime reporting obligation shows us the potential money laundering risk faced by a firm, based on its regulated activities and the nature of its customers. The obligation is set out in our Handbook SUP 16.23 Annual Financial Crime Report (REP-CRIM). When we introduced it, we committed to consulting on any future policy change and providing a cost benefit analysis.

We currently assess whether REP-CRIM applies by looking at firm type, eg banks, building societies and mortgage lenders and activity type, eg intermediaries, e-money institutions and consumer credit firms.

Approximately 2,500 of the 23,000 firms we supervise under The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLRs) submit annual REP-CRIM information.
We propose extending our requirements to include firms that carry on regulated activities that we consider potentially pose a higher money laundering risk. This extension will be irrespective of a firm’s revenue threshold.

Who this applies to

This consultation is relevant to firms or businesses that we supervise under the MLRs.

Background to this money laundering consultation

In our 2019/20 Business Plan, we said we would consider extending the REP-CRIM reporting obligation to more firms. This commitment was also noted in the UK’s Economic Crime Plan 2019 to 2022. Reviewing our REP-CRIM policy has allowed us to keep up to date with changes in legislation and Government amendments to the MLRs which transposed the EU’s 5th Money laundering directive into UK law, for instance the inclusion of cryptoasset businesses to the scope of the MLRs.

Next steps

This consultation has now closed. 

We will consider the feedback received and engage directly with stakeholders on these matters. Subject to the feedback, we aim to publish a Policy Statement (PS) by Q1 2021.

Page updates

24/11/2020: Information changed consultation closed