Who is regulated under the Money Laundering Regulations 2017?
Our guide to the UK economic crime regime sets out the key pieces of anti-money laundering and economic crime legislation.
The regulated sector
If your firm or organisation provides any of the below services, it is in scope of the MLRs 2017 and must comply with the requirements.
You will need to decide for yourself whether a matter is in scope of the MLRs 2017.
There is no de minimis for small transactions or limited amounts of work. If an activity you do is in scope, the regulations apply in full.
Firms/individuals providing reserved legal services
Certain legal services can only be provided to the public by an individual, business or organisation authorised by an “approved regulator”.
The Legal Services Act 2007 sets out the reserved legal activities (section 12 and Schedule 2). They are:
- rights of audience
- conduct of litigation
- reserved instrument activities
- probate activities
- notarial activities
- administration of oaths
The Solicitors Regulation Authority (SRA) is the approved regulator for all the reserved legal activities except notarial activities, which are regulated by the Faculty Office.
Read the SRA’s guidance on firm authorisation
Legal or notarial service providers
Independent legal professionals who provide legal or notarial services on behalf of customers (including planning, executing or assisting) in financial or real property transactions concerning:
- the buying and selling of real property or business entities
- the managing of client money, securities or other assets
- the opening or management of bank, savings or securities accounts
- the organisation of contributions necessary for the creation, operation or management of companies
- the creation, operation or management of trusts, companies, foundations or similar structures
Trust and company service providers
Trust and company service providers (TCSP) who provide any of the following services:
- forming companies or other legal persons
- acting, or arranging for another person to act:
- as a director or secretary of a company
- as a partner of a partnership
- in a similar capacity in relation to other legal persons
- providing a registered office, business address, correspondence or administrative address or other related services for a company, partnership or any other legal person or legal arrangement
- acting, or arranging for another person to act, as:
- a trustee of an express trust or similar legal arrangement
- a nominee shareholder for a person other than a company whose securities are listed on a regulated market
Tax advisers
Tax advisers who provide material advice, assistance or advice in connection with the tax affairs of others, whether provided directly or through a third party.
Out of scope activities
There is no definitive list of legal activities that do not fall within scope of the MLRs 2017.
The SRA says that although a type of legal work, such as litigation, might be considered out of scope, "a particular matter could be drawn into scope if, for example, you were to set up a trust for the client as part of the matter.”
See the SRA’s guidance on the scope of the MLRs 2017
The application of the UK sanctions regime to firms not regulated by the MLRs will need to be evaluated on a case-by-case approach when deciding whether a matter is in scope.
Learn more about the UK sanctions regime
If you are unclear, you should seek independent legal advice.
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