Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 definition and meaning | AML glossary
Money Laundering Regulations 2017 definition: What it means in AML compliance.
Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017, commonly known as the MLRs 2017, these UK regulations were introduced to strengthen the framework for preventing money laundering and terrorist financing.
They implement the EU’s Fourth Money Laundering Directive and set out the legal requirements for regulated firms in relation to customer due diligence, ongoing monitoring, internal controls, and record-keeping. The regulations apply to a wide range of sectors, including financial institutions, estate agents, accountants, tax advisers, and legal professionals.
Key requirements under the Money Laundering Regulations 2017.
Firms within scope must ensure they:
- Conduct robust Customer Due Diligence (CDD) and Enhanced Due Diligence (EDD) when appropriate.
- Maintain accurate beneficial ownership information.
- Implement risk-based approaches tailored to their services and clients.
- Keep detailed records for a minimum of five years.
- Provide specific information on the payer when transferring funds.
- Appoint a Money Laundering Reporting Officer (MLRO) and conduct regular staff training.
Why it matters for compliance.
These regulations form the backbone of the UK’s Anti-Money Laundering (AML) framework. Non-compliance can result in severe consequences, including:
- Regulatory fines and penalties.
- Reputational damage.
- Increased scrutiny from supervisory bodies.
- Loss of licence or authorisation in extreme cases.
Firms are expected to not only comply but demonstrate ongoing effectiveness through audits and reviews.
Examples of enforcement.
Regulators have taken action under the MLRs 2017, including:
- A major fine against a professional services firm for inadequate due diligence and failing to identify risk indicators.
- Penalties for firms that failed to maintain up-to-date beneficial ownership information.
- Warnings and sanctions for poor record-keeping and insufficient staff training.
How technology helps firms comply with the Money Laundering Regulations 2017.
Tech-enabled compliance solutions make it easier to meet the requirements of the regulations by helping firms:
- Automate CDD and EDD workflows.
- Flag high-risk transactions or clients based on real-time data.
- Maintain audit trails and document client risk profiles.
- Monitor changes in beneficial ownership and trigger re-checks.
- Stay aligned with updates to regulatory obligations.
By integrating compliance technology, firms can reduce human error, improve efficiency, and demonstrate proactive risk management.
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