Recommendation 37

HM Government · verbatim extract Acknowledged

HM Treasury’s ongoing review of the MLRs and OPBAS Regulations offers the opportunity for one of the most comprehensive assessments of the UK’s anti-money laundering/counter-terrorist financing (AML/CFT) regime in years. HM Treasury has engaged widely with stakeholders in both the public and private sectors to inform the scope of the Review, including through a call for evidence which ran from July to October 2021. A key aim of the MLRs Review is to ensure there is effective, responsive AML supervision across the UK’s regulated sector. The Call for Evidence asked broad-reaching questions about the structure of the UK’s supervision regime. Questions in the Call for Evidence also invited views specifically on the effectiveness and sufficiency of existing enforcement measures. There have been clear improvements across the UK supervisory regime and PBS compliance with the MLRs, reflected in sector feedback and examples of more robust enforcement. Policy objectives in this area have been largely met, with the need for a focus on overall effectiveness rather than technical compliance moving forward. OPBAS will continue to take action with PBSs when appropriate, to ensure that consistent high standards of compliance are achieved. The MLR Review is considering the work of OPBAS to drive the consistency and efficiency of PBS supervision, and in parallel to the assessment of the structure of the UK’s supervision regime will consider what future remit and powers OPBAS should have. Statutory supervisors (the FCA, HMRC and the Gambling Commission) are public bodies who are directly accountable to Parliament for their work and HM Treasury works closely with all three supervisors on their AML supervision. Any decision on the future model of supervision used by the UK would have significant consequences and must be informed by in-depth analysis and consideration of the implications for the UK’s overall efforts to prevent money laundering and terrorist financing. HM Treasury will respond to Call for Evidence responses and set out next steps in the report on the Review’s findings, due to be published in June 2022.