Make changes to your Anti-Money Laundering authorisation

30 January 2020

You need to apply to make changes to your Anti Money Laundering (AML) authorisation.

What is this application for?

Firm

You must confirm the services your firm undertakes that are subject to money laundering regulations.

Individuals

You will need to nominate the following role holders:

  • money laundering compliance officer (MLCO)
  • money laundering reporting officer (MLRO)

If your firm has any individuals that under the MLRs are considered a manager, beneficial owner or officer of the firm, they need to apply for approval to us under regulation 26. These officers will be identified in mySRA after they have been approved by the role title “Anti Money Laundering Officer”.

Help with your application

Contact us if you have any queries before you submit your application

How to apply

Help with your application

You should read the guidance before you start your application.

Contact Authorisation if you have any queries before you submit your application

Form

The form is an editable PDF and must be completed electronically. You must save a copy of the form to your computer before you start to fill it in. These forms are not compatible with Mac computers.

You need to apply to make changes to your existing AML approval using the AML form (FA10b).

New legislation on Anti-Money Laundering came in on 10 January 2020 that will affect new beneficial owners, officers and managers (BOOMs) and BOOMs switching firms. When a BOOM applies to us for approval, we will need:

  • proof that they do not have any criminal convictions that would prevent them from becoming a BOOM
  • this proof to be in the form of a basic disclosure and barring service (DBS) check
  • the basic DBS check to be no older than three months on the date of application.

Please read more information on how to source these checks.

Form

Send your application to our Authorisation team.

Fee

There is no fee for this application.

What you can expect from us

We will acknowledge your application within one working day. We will let you know if your application is incomplete or ineligible.

Timescales

We aim to make decisions within 90 days.

While you should now have submitted the form, you might still find these questions and answers useful.

After submitting your form

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Once we have received your completed AML application form we will begin a process to approve the officers, managers and beneficial owners and to form an opinion on whether Trust or Company Service Providers are fit and proper and should be included on the HMRC register.

We will send you a link so that we can completed a DBS check, and the process your firm will go through will depend on the activities you are offering.

We will await the results of the DBS checks before we can make a decision on whether the firm is fit and proper and can be entered onto the HMRC register. A delay in completing the DBS checks may result in a delay in your firm being entered onto the register and being able to continue this type of work. If any officer, managers or beneficial owners have a criminal conviction set out in Schedule 3 of the money laundering regulations, we cannot consider your firm to be fit and proper until they have been removed from this position and the firm will not be included on the HMRC register until this point.

We will await the results of the DBS check and we will approve the officer, managers and beneficial owners in the firm. If any of these individuals have a criminal conviction set out in Schedule 3 of the money laundering regulations, they may no longer hold the position of officer, manager or beneficial owner in a firm offering activities within scope of the money laundering regulations.

Process guidance

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You need to complete an electronic form (FA10) and return the complete form to us with your Firm Application.

Some people named in your response may need to provide information for criminal record checks to be carried out. This is because you will have confirmed that they are an MLRO, beneficial owner, officer or manager and not previously authorised by us as either a solicitor, REL, RFL or any other authorised role holder, or you have declared that they have a criminal conviction.

Atlantic Data Disclosures will contact the individuals directly by email with all the necessary information and instructions to complete a DBS check. Read atlantic data guidance

There is no fee to complete the online application for approval under the Money Laundering Regulations. The online application closes at 17.00 on 2 February 2018 and there may be a charge for anyone whose application is late if a DBS check is required. There may also be a fee to make changes to your approval status (for example by adding an officer, manager or beneficial owners) after the online application has closed and on an ongoing basis where a DBS check is required.

Guidance on the regulations

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Relevant individuals are beneficial owners, officers and managers, as defined in the money laundering regulations. If you are still unclear on your obligations under the regulations, we would suggest you obtain specialist advice.

The new Money Laundering Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations (MLR) came into force this year, and put new obligations on regulated firms, and the SRA as a supervisor.

Regulation 8 states that the MLR apply to certain categories of persons acting in the course of business carried on in the UK. The main categories likely to be relevant are:

  • independent legal professionals participating in certain financial or real property transactions (regulation 12(1))
  • trust or company service providers (regulation 12(2))
  • auditors, insolvency practitioners, external accountants and tax advisers (regulation 11)
  • estate agents (regulation 13)

We are asking you to tell us if you undertake work in any of these categories because we are required to maintain a record of who we supervise under each category.

The category that is most likely to be applicable is “independent legal professional”. This applies to all firms participating in the financial or real property transactions listed at regulation 12(1). It is likely to include those firms offering conveyancing services or corporate finance work.

Many firms may also be acting as a trust or company service provider, and some others may be acting as tax advisers, or estate agents, etc.

Example 1 We are a small practice that concentrates on road traffic criminal cases but from time to time will carry out property transactions for established clients on a fixed fee basis. We rarely use client account other than to receive funds in respect of the purchase or sale proceeds. Surely we are “managing client money, securities or other assets” as we are facilitating the conveyancing transactions?

You will not be “managing client money, securities or other assets” by receiving these funds for that purpose. Managing client money has a narrower definition than just handling funds through your client account in accordance with your client’s instructions. In order to “manage” there must be some additional discretion and involvement by the firm in relation to the funds held. An example of this would be if the firm has been appointed as an attorney and operates a client’s own account.

Example 2 We are firm that specialise in will writing. Many of our clients are elderly and instruct us in relation to private client matters generally. On occasion we are asked to be their receiver if they lose capacity and on occasion need to make arrangement for assets to be realised, shares etc, to pay for nursing home fees. Do we fall within the Money Laundering Regulations 2017?

Yes you are right. You will fall within the category of “managing client money, securities or other assets” in Regulation 12(1)(b) of the regulations. Although will writing falls outside the regulations, if the firm advises a client on estate planning as part and parcel of its will writing service it will be regarded as a “tax adviser” as defined in Rule 11(d) of the regulations.

Example 3 As a firm we offer exclusively employment and immigration law services to clients on a fixed-fee basis. We do not ask clients to pay money on account and prefer to pay any disbursements associated with a client’s matter from office and bill the client at the end. The exception to this is when we instruct counsel. When this is the case, we ask the client for money on account. Are we caught by the Money Laundering Regulations 2017 and have to appoint a money laundering reporting officer?

No. You will not be caught by the regulations by virtue of the employment work which, by its nature, will fall outside the regulated sector. Receiving money in payment of your fees or for the fees of a third person instructed on a matter will not bring you within you within the Regulations. Your firm will not be involved in “managing client money, securities or other assets”.

If a firm’s activities fall entirely outside the scope of the Money Laundering Regulations, it is not compulsory to appoint a money laundering reporting officer. Firms may still wish to appoint an MLRO. This is because it will still be subject to the Proceeds of Crime Act and the Terrorism Act and may need to receive disclosures from members of staff and make disclosures to the National Crime Agency.

Yes. See chapter 1.4.5 of the Legal Sector Affinity Group (LSAG) Guidance for the Legal Sector (PDF 153 pages, 1.5.MB) for detailed guidance on the meaning of "independent legal professional" and the other terms above.

Chapter 1.4.5 also clearly sets out what is not covered by the regulations. For instance:

  • payment on account of costs
  • provision of legal advice
  • participation in litigation, and
  • work funded by the Legal Aid Agency

are all generally unlikely to be viewed as "participation in a financial transaction".

There are some exclusions set out at regulation 15 of the Money Laundering Regulations. In order to be covered by an exemption, all of the following would need to apply to you:

  1. the person’s total annual turnover in respect of the financial activity does not exceed £100,000;
  2. the financial activity is limited in relation to any customer to no more than one transaction exceeding 1,000 euros, whether the transaction is carried out in a single operation, or a series of operations which appear to be linked;
  3. the financial activity does not exceed 5 per cent of the person’s total annual turnover;
  4. the financial activity is ancillary and directly related to the person’s main activity;
  5. the financial activity is not the transmission or remittance of money (or any representation of monetary value) by any means;
  6. the person’s main activity is not that of a person falling within regulation 8(2)(a) to (f) or (h);
  7. the financial activity is provided only to customers of the main activity of the person and is not offered to the public.

It is advisable to have a money laundering compliance officer and a money laundering reporting officer. These roles are set out in Regulation 21(1)(a) and 21(3) and are an important part of making sure your firm is geared up to prevent and detect money laundering. There are some limited exemptions in the regulations:

  • You may not have a money laundering compliance officer if it is inappropriate for the size or nature of your business (Regulation 21); or if you are a sole trader, who does not employ anyone and do not act in association with any other person (Regulation 21(6)).
  • You may not have a money laundering reporting officer if are a sole trader, who does not employ anyone and do not act in association with any other person (Regulation 21(6)).

If you think either exemption applies to your firm, please remove the suggested names from the role field and submit your application with the answer to the appropriate question (question four, and/or five) blank and tick the box to confirm you do not have an MLRO and/or MLCO.

“Manager”, in relation to a firm, means a person who has control, authority or responsibility for managing the business of that firm, and includes a nominated officer. The exact wording of Regulation 3 is as follows: “manager”, in relation to a firm, means a person who has control, authority or responsibility for managing the business of that firm, and includes a nominated office.

Yes, if the subsidiary is a separate legal entity, you will need to complete a separate form for this company.

If the entity is authorised or regulated by us, or should be - yes

If the entity is not authorised by us and does not need to be. However while we may not be the supervisory authority for the subsidiary, if the entity is carrying on an activity which is caught by the MLR, we will still need to seek approval with the relevant supervisory authority - no

Regulation 7 of the regulations sets out the relevant supervisory authorities.

Yes, all firms that we authorise are required to complete the form. However, as long as all legal services are being provided through the main entity, you can declare that you are not carrying out any of the activities covered by the money laundering regulations and you will not need to appoint any of the relevant individuals.

The money laundering regulations apply to those acting in the course of business carried on in the UK. If the firm is acting in the UK they may be in the scope of the regulations and will need to complete an online form.

Example 1 We have an office in London that is regulated by you as an authorised body. The work generated by the firm is carried out exclusively by our branch offices abroad in relation to matters in those particular jurisdictions and not the London office. Does the firm have to complete the online form?

The online form must be completed by every firm we regulate as an authorised body. The Money Laundering Regulations 2017 apply to those acting in the course of business in the United Kingdom. If you are an entity authorised by us but you are not offering these services in the UK, you can select “no” to questions relating to whether the firm carries out work covered by the Money Laundering Regulations and proceed directly to the declaration page.

Example 2 We are an international law firm that has branch offices situated abroad. While the head office does not conduct any work governed by the Money Laundering Regulations, our branch offices do on occasion carry out work that relates to property or assets in the UK that comes within the regulations. Do we need to consider the work carried out by these offices when completing the money laundering form?

The Money Laundering Regulations apply to those acting in the course of business in the United Kingdom. The online form is designed to capture this information in relation to work carried out by the authorised body as a whole. If an office is part of an entity we regulate and it conducts work regulated by the Money Laundering Regulations, we need know about this. Questions 1-3 of the form must be completed accordingly.

Example 3 We are an international law firm with many offices worldwide not all of which are regulated by the SRA. Some of the directors in a non-regulated entity have owners and managers in common with an SRA-regulated entity in the group structure. Do these foreign lawyers need to be included on the money laundering form?

All owners, managers and beneficial owners as defined by the Money Laundering Regulations of a firm we regulate must be included on the money laundering form. This is the case even if the individuals are based overseas and do not carry out legal services for clients in the name of the authorised body.

DBS checks

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Tell them they have been nominated and that they may need to complete a DBS check before 2 February 2018. You should also remind them that we will not be able to approve the firm until they have completed the DBS check.

Any individual who has not previously been authorised by us as a solicitor/REL/RFL or authorised role holder will need to complete a DBS check.

Any individual who has already been authorised by us but who you declare to have a relevant conviction will also need to complete a DBS check.

We will notify all firms of the names of any individuals who are required to complete a DBS check, we will contact the individuals directly and explain the process for doing this.

The individual will need to nominate a solicitor to verify their ID documents. You can help by providing the details of the solicitor who will carry out the ID check, as they will need this information to complete the DBS application.

  • Name
  • Email address
  • SRA ID number

You can then also help by organising for the check to take place at your firm at the earliest convenience to prevent any approvals being delayed.

Firm approvals will not take place until all named individuals have been approved.

Once they are listed on mySRA, you will be able to end their association with the firm, as you would with any other employees.

The person completing the form must declare whether any person they are seeking to be approved under the money laundering regulations has one of the convictions set out in Schedule 3 of the Money Laundering Regulations which is unspent. Read the list of convictions.

Providing no relevant persons have any convictions listed in Schedule 3 of the Money Laundering Regulations, we will be in a position to approve the firm. We will send you confirmation of this decision once it is made.

If your firm is a trust and company service provider, we are also required to provide details to HMRC.

Individuals should be aware that in this situation, approval of the firm may be delayed until all named individuals are approved.

The SRA cannot approve any individual who has a conviction listed in Schedule 3 of the Money Laundering Regulations 2017.

Enforcement

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Yes. We must collect the data required to fulfil our responsibilities as an AML supervisor, so we are requiring all firms to respond.

You will not be able to undertake the work within the scope of the MLR if you have not been approved.

The form will be a notice under our Handbook and the regulations. This means you must complete it. If you do not, you will have failed to comply with a mandatory notice and we will consider taking enforcement action against you. If you undertake work subject to the regulations and fail to complete this application you will be committing a criminal offence.

Those undertaking work within the scope of the money laundering regulations who have not completed the form, and therefore applied for approval as required by regulation 26, are committing a criminal offence.