HM Revenue & Customs Money Laundering Regulations

Her Majesty's Revenue & Customs (HMRC) in the UK collect taxes in general and helps families and individuals with targeted financial support. But besides these responsibilities, another important responsibility is to work with the Financial Conduct Authority (FCA) to investigate money laundering crimes. HM Revenue & Customs have some legislation put forward to combating financial crimes. HMRC's aim in these regulations is to reduce AML threats in the UK. 

What Is Her Majesty's Revenue & Customs?

HM Revenue & Customs is the UK's tax and customs authority. HMRC's most important goal and responsibility in the UK are to collect money paid for public services and become a targeted financial supporter of families or individuals. HMRC is an impartial and effective authority. HM Revenue and Customs are responsible for a lot of things in the UK. For example, income tax, capital gains tax, oil income taxes, environmental taxes, excise taxes, national insurance.

HM Revenue & Customs must study FCA to investigate money laundering crimes. Businesses required to comply with the Money Laundering Regulations in the UK have to be supported by authority, and these businesses have to register with HMRC. In addition, there are several regulations that HM Revenue has issued to combat financial crimes, and these regulations also include anti-money laundering legislation in businesses. 

Business Sectors Supervised by HM Revenue and Customs for AML Regulations

The regulations established by HM Revenue and Customs to anti-money laundering apply to some institutions in the UK. Businesses have to decide whether they must comply with HM Revenue and Customs regulations and register with HM Revenue and Customs in the UK. Thus, they are subject to regulations and are audited regularly. Especially in the UK, seven sectors have to comply with HMRC to be regulated. However, businesses are not required to register with the HM Revenue if supervised by The Financial Conduct Authority or supervisory authority. Here are sectors supervised by HMRC: 

  • Bill payment service providers not supervised by The Financial Conduct Authority
  • Money service businesses not supervised by The Financial Conduct Authority
  • High-value dealers
  • Company service providers not audited by The Financial Conduct Authority or a professional organization
  • Real estate agency businesses
  • Accounting service providers not audited by a professional body
  • Rental to agency companies
  • Digital, telecommunications, and IT payment service providers not supervised by The Financial Conduct Authority
  • Art market participants 

In The UK Business Responsibilities Under Money Laundering Supervision

Businesses covered by HMRC's Money Laundering Regulations are required to fulfill specific responsibilities. Chief among these responsibilities is to perform "Customer Due Diligence" measures to check whether the customers say they are and perform a risk assessment. In addition to these, businesses have to have internal control and monitoring systems. The nature of the controls to be performed may differ in each company. The nature of these controls varies according to the number of customers, the number and type of services, and the business's size.

HM Revenue & Customs's Money Laundering Supervision Penalties

In the UK, businesses that comply with HM Revenue & Customs regulations may impose measures, including a financial penalty, if businesses do not comply with the Money Laundering Regulations. If more serious situations occur, companies may be subject to criminal prosecution. HMRC tries to take precautions by sending warning letters to the institutions in non-compliance with the regulations. Failure to comply with notes may increase the measures to criminal prosecution. These measures of HMRC are to encourage compliance with obligations. The amount of fines varies depending on the cause of non-compliance, the seriousness of the crime, the business's size, and the amount subject to money laundering.  

As of 25 July 2018, HM Revenue & Customs have introduced a penalty administration fee for all anti-money laundering control penalties. Businesses will be required to pay a £ 1,500 penalty handling fee for violations if they fail to carry out customer due diligence, risk assessment, policies, controls and procedures, record-keeping procedures, and failure to comply with the warnings. In addition to these penalties, HM Revenue may impose up to £ 350 for businesses that do not register, report changes in their business, and do not provide information.

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