Compliance HMRC / LLA

MONEY LAUNDERING REGULATIONS

Money Laundering Regulations 2017: statutory instruments

Money Laundering Regulations 2017: consultation

26th June 2017: This is interim guidance and will be amended in due course. 

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/621868/Trust_or_Company_Service_Provider_Guidance.pdf

The section on politically exposed persons will be reviewed once the Financial Conduct Authority has published their own guidance.

Since 2007 there has been legislation in place detailing Money Laundering Regulations that applies to our sector which includes:

Business Centres/Workspace/Hubs/Coworking Space/ Accommodation Address - VO Providers.

Changes to the guidance for Trust or Company Service Providers June 2013

Following a consultation with the relevant trade body, HM Revenue & Customs (HMRC) is amending the registration guide for Trust or Company Service Providers (TCSPs) to clarify who is liable for registration.

For the purposes of the Money Laundering Regulations, HMRC has confirmed that any business that provides any of the following is classed as acting as a TCSP:

  • registered offices
  • business addresses
  • accommodation or correspondence addresses
  • mail forwarding or other related services for a company, partnership or any other legal person or arrangement

For these purposes, 'legal person or arrangement', does not include sole traders or private individuals.
The following extract from the guidance may be helpful:

I provide company services to businesses by forwarding their mail. Will I be required to register?
Yes, if you undertake these activities on behalf of a company or partnership

I provide office accommodation. Is my business within the scope of the regulations?
No, the right to physically occupy your premises is not the same as the right to use your address.

I operate a business providing a virtual office service. Is this business within the scope of the regulations?
Yes, if you provide services such as answering telephone calls and emails, mail forwarding and other related admin services along with the provision of a business address or an accommodation address.

I provide a business/correspondence/accommodation address. Is this within the scope of the regulations?
Yes, if you provide another firm with the right to use your address as a place where customers or others can send correspondence. This does not apply where customers are sole traders or private individuals.

I provide office accommodation by renting out physical space to customers and I also provide admin services to these customers such as secretarial services and telephone and e-mail answering services. Is my business within the scope of the regulations?
No, you are not within the scope of the regulations if you are providing a physical space to your customers.

You should contact HMRC immediately if you are not registered for supervision under the Money Laundering Regulations and you provide registered offices, business addresses, accommodation or correspondence addresses, or mail forwarding or other related services for a company, partnership or any other legal person.
Here is the link https://www.gov.uk/government/collections/money-laundering-regulations-forms-and-guidance

http://www.hmrc.gov.uk/mlr/getstarted/register/how.htm#1

Fees http://www.hmrc.gov.uk/mlr/getstarted/reg-fees.htm

MLR100 - Application for Registration

MLR101- Fit and Proper Test

Businesses currently registered with HMRC for anti money laundering supervision will need to renew online by their renewal dates.  HMRC will write to, and email businesses approximately a month prior to renewal date.  HMRC will direct you to the online service.

Any business that need to advise HMRC of changes, or additional premises, should use the RCT1 form until they have renewed online.

The form can be found on GOV.UK 

https://www.gov.uk/guidance/money-laundering-regulations-report-changes-to-your-business  

After renewing online businesses will be able to make any changes directly via their online account.

Enquiries: Anti Money Laundering Regulations Contact Centre: 0300 200 3700 [03000 591 009]

Southern Ireland:

Anti-Money Laundering Compliance Unit Telephone: + 353 [0]1602 8400 

Email: antimoneylaundering@justice.ie

Department of Justice and Equality
94 St. Stephen’s Green
Dublin 2

www.justice.ie

LONDON LOCAL AUTHORITIES ACT 2007 -

http://www.legislation.gov.uk/ukla/2007/2/pdfs/ukla_20070002_en.pdf

LLA Adopted Authorities Sep 2017.pdf

New provisions controlling mail forwarding businesses are contained in section 75 of the London Local Authorities Act 2007 and come into force in Westminster on 7 January 2008.

A mail forwarding business is carried on in Westminster, if the postal address that is made available and to which postal packets may be sent, is in the area of Westminster.

‘Mail forwarding business’ is defined in section 75 of the Act as, the business, carried out for reward, of making available to a person a postal address to which postal packets may be sent, and doing either or both of the following- a) holding postal packets so sent for collection by that person or his agent; b) forwarding, by whatever means, postal packets so sent to that person.

Requirement to Register with the Council

A person is not permitted to carry on a mail forwarding business in Westminster without being registered with the Council.

This applies whether the mail forwarding business is carried on alone or in conjunction with any other business.

An application in writing to the Council for registration is required to be made giving details of the name and address of the applicant and the address of each place in the borough occupied by the applicant for the purposes of the business.

Should the name and address of the applicant or the address of each place of business change after registration then it is a requirement to notify the council with 14 days of the change to enable the council to amend the registered details.

Record Keeping

A person carrying on a mail forwarding business is required to keep a record of :

  1. the full name, address and telephone number of all persons for whom post is received or who has requested postal packets received to be held or forwarded to them
  2. the nature of the business (if any) carried out by that person
  3. any instructions as to the delivery or forwarding of postal packets
  4. the name and address of person(s) to whom postal packets are to be forwarded, if different from 1) above
  5. copies of originals of two documents of a type approved by the council for the purposes of identifying the person and verifying the address(es) required in 1) above.

A client’s name and address in 1) above must not be the name and address of another mail forwarding business.

The name and address in 1) above must be

  1. in the case of an individual, his private address
  2. in the case of a body corporate or partnership
    (note, a body corporate includes a limited company)
  1. the registered office address or the principal address of the partnership and
  2. the names and private addresses of the directors or partners or another person directly or indirectly responsible for the management of the body corporate or partnership and
  3. the address of the principal place of business of the body corporate or partnership if different from any of the addresses mentioned in 1) and 2) above.

This will mean that apart from where a client is a sole individual, a contract with a mail forwarding business will require more than one name and address to be held by a mail forwarding business.

Retention and Inspection of Records

A mail forwarding business is required to keep records of clients for at least a year after the end of an arrangement (or contract) to hold or forward on postal packets and to keep them available for inspection by the police or any authorised officer at all reasonable times.

Offences

It is a criminal offence for a person to:

  • fail to comply with the provisions of section 75 or;
  • furnish false information –
  • in making an application for registration or notifying the Council of any alteration to the registration particulars held or
  • to a mail forwarding business in relation to particulars the business is required to keep;
  • make a false entry in records kept by a person carrying on a mail forwarding business.

It should be noted from the above, that a client will commit an offence if they provide required information that is false.

In relation to the investigation of an offence,Trading Standards Officers have the power to enter premises and inspect and seize goods and documents.

Penalties

The maximum penalty for committing an offence, is a fine not exceeding £5000 on summary conviction.

Transition Period

The legislation allows a period of four weeks from the date of coming into force before the requirements to register and keep records apply to a business.
The legislation comes into force on 7 January 2008, therefore the requirements to register and keep records are effective from 4 February 2008.

If an application has been made for registration during the four week period then the business may lawfully continue to carry on the business and need not comply with the requirement to keep records until the Council issues a certificate of registration.

Documents for Identification and Verification Purposes.

The legislation requires copies to be kept of the originals of two documents of a type approved by the council for the purposes of identifying a person and verifying their address.

Types of documents approved by Westminster Council are listed in Annex 1 attached.

In order to identify a person one document should be taken from the photo identification in list 1 and to verify their address, a second document from list 2.

In the case of a body corporate (limited company) the certificate of incorporation will be considered as verifying the name of the body corporate. A second document should be taken from list 2 to verify the registered office address.

Please Note-

In order to ensure a copy of a document is that of the original, as required by law, it is strongly recommended that the copy is taken by yourself from the original document. Alternatively you may wish to ask for a certified copy of an original document. It is recommended that a certified copy of a document is certified by a professional person. It is up to you to take steps to satisfy yourself that the copy you hold is that of the origina

This guidance document has been prepared by Westminster Community Protection Department for the assistance of businesses in Westminster. It is not an authoritative interpretation of the law and is intended for guidance purposes only.

Annex 1: Documents Approved by the City of Westminster for Identification Purposes

Two documents one from each list is required.

1. Photo identification – Proof of identity

  • Passport
  • Driving Licence (with photocard)
  • National Identity Card
  • HM Forces Identity Card
  • A current student card
  • Employment identification card
  • Disabled drivers blue pass

2. Proof of address (provided both name and address is shown)

  • Gas or Electricity bill
  • Telephone bill
  • Water bill
  • Mortgage Statement
  • Council Tax bill
  • Bank / Building Society statement (includes credit card/ store card bill)
  • TV licence
  • Valid insurance certificate
  • Pay slip
  • P45/P60 statement
  • Financial statement (e.g. pension, endowment)
  • Current benefit book
  • Letter from Benefits Agency
  • HM Revenue and Customs Notice of Coding
  • Student hall of residence agreement or other proof of accommodation

Money Laundering Regulations Glossary of Terms
Term Meaning/explanation

3MLD Third Money Laundering Directive 
4MLD/the Directive Fourth Money Laundering Directive 
AML Anti-Money Laundering 
AML/CFT Anti-Money Laundering and Counter-Financing of Terrorism 
ASP Accountancy Service Provider 
BEIS Department for Business, Energy and Industrial Strategy 
CDD Customer Due Diligence 
CTF Counter Terrorist Financing 
DPA Data Protection Act 1998 EDD – enhanced due diligence 
ESA European Supervisory Authorities 
EU Europe/European 
EUR Euros (currency) 
FATF Financial Action Task Force 
F&p Fit and Proper 
FCA Financial Conduct Authority 
FIU Financial Intelligence Unit 
FOIA Freedom of Information Act 2000 
FTR Fund Transfer Regulations 
HMRC Her Majesty’s Revenue and Customs 
HVD High Value Dealer 
IPS Internet Provider Systems 
ISF International Sporting Federations 
LLP Limited Liability Partnerships 
ML Money Laundering 
MLRs Money Laundering Regulations (collective reference to all previous Money Laundering Regulations) 
MLRs 2003 Money Laundering Regulations 2003 (current until 15th December 07 
MLRs 2007 Money Laundering Regulations 2007 (will cancel and replace MLRs 2003 from the 15th December 2007) 
MLR/Regulations Money Laundering Regulations 2007 
ML/TF Money Laundering and Terrorist Funding 
MSB Money Service Business 
NCA National Crime Agency 
NO Nominated Officer 
NRA National Risk Assessment 
OFT Office of Fair Trading 
PCA Pooled Client Account 
PEP Politically Exposed Person 
PoCA Proceeds of Crime Act 2002 
PSC Persons with Significant Control Regime 
Relevant Business Business activity to which the Money Laundering Regulations apply, and for the purposes of this notice means MSB, HVD, TCSP and ASP 
SAR Suspicious Activity Report 
SDD Simplified Due Diligence 
SE Societas Europaeae 
SNRA Supranational Risk Assessment 
STR Suspicious Transaction Report 
TA Terrorism Act 
TACT Terrorism Act 2000 
TCSP Trust or Company Service Provider 
VAT Value Added Tax 

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