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Government publishes new Money Laundering Regulations - new obligations for UK corporates

  • United Kingdom
  • Corporate
  • Financial services disputes and investigations
  • Fraud and financial crime
  • Litigation and dispute management

23-06-2017

The UK Government today published the final version of the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (the “New Regulations”).

The New Regulations bring into effect the UK’s pre-Brexit obligations to implement the requirements of the EU 4th Money Laundering Directive.

We will in due course be providing our clients with detailed analysis of the key changes brought into effect by the New Regulations, but one immediate difference between the New Regulations and the existing 2007 Money Laundering Regulations, is that non-listed companies now have a specific obligation which they must comply with.

Regulation 43 of the New Regulations states that when a UK body corporate (incorporated under the law of the United Kingdom or any part of the United Kingdom, and includes an eligible Scottish partnership) enters into a relationship with a regulated person (i.e. financial institution. lawyer etc.) it must:

  • upon request provide the regulated person with:
    • its name
    • its articles of association (or other governing documents)
    • information regarding its board of directors (or equivalent management body)
    • information identifying the senior persons responsible for its operations
    • details of the law to which it is subject
    • details of its legal owners, and
    • details of its beneficial owners
  • ensure that if, during the course of the business relationship, there is any change in the information stated above, it must notify the regulated person of the change and the date on which it occurred within 14 days from the date on which the body corporate becomes aware of the change, and
  • provide any of the above stated information to law enforcement upon request

 The New Regulation states that where a disclosure is made in good faith there can be no civil liability on the part of the UK body corporate.
 
Companies should ensure that their company secretary and/or any compliance teams responsible for providing corporate information to banks, lawyers and other regulated persons are aware of this new obligation and to ensure timely provision of the required information as failure to comply with the above requirements may result in either civil or criminal penalties.

For more information contact

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