TR18/3: Money Laundering and Terrorist Financing Risks in the E-Money Sector

This report shares the findings of our thematic review into money laundering and terrorist financing risks in the e-money sector.

Show TR18/3 (PDF)

Who should read this

Our findings will primarily be of interest to firms operating in the e-money sector. Payment services firms may also be interested in the review.

What our scope was

We visited 13 Electronic Money Institutions to assess their anti-money laundering and counter-terrorist financing control framework. Our review was focused on e-money products, including prepaid cards and digital wallets.

We did not assess other services provided, such as money remittance. We also excluded activities outside of the FCA’s supervisory remit, including gift cards that can be used only within a limited network, or any prepaid product denominated in a virtual currency.

What we found

Overall, the review established that the 13 firms assessed had reasonably effective anti-money laundering and counter-terrorist financing systems and controls. However, the work did highlight some weaknesses, therefore all firms should avoid any complacency.

Next steps

We will continue to monitor e-money firms as part of our ongoing supervisory strategy. Any future supervisory work will take our findings into account and we will address harm in individual firms where we see it.