The majority of the amendments introduced by the Money Laundering and Terrorist Financing (Amendment) Regulations 2026 came into force on 30 June 2026.
The changes are not extensive, but regulated firms should review their anti-money laundering documentation to ensure that their Policies, Controls and Procedures (PCPs), Practice Wide Risk Assessment and client and matter risk assessment processes remain up to date.
What has changed?
Enhanced Due Diligence
Perhaps the most significant practical change is to the trigger for Enhanced Due Diligence (EDD).
Previously, firms were required to consider EDD where a transaction was complex or unusually large. The Regulations now require EDD where a transaction is unusually complex or unusually large, or where other high-risk factors apply.
This reinforces the UK’s risk-based approach and recognises that many legal transactions are naturally complex without necessarily presenting a higher money laundering risk.
High-Risk Third Countries
The definition of a mandatory “high-risk third country” has changed.
Mandatory EDD now applies only where a client or transaction involves a country that is subject to a Financial Action Task Force (FATF) Call for Action (currently Iran, North Korea and Myanmar).
Countries on the FATF Increased Monitoring (“grey”) list no longer automatically trigger EDD. However, they remain an important geographical risk factor and firms should continue to consider them as part of their risk assessment. Many firms may decide, as a matter of policy, to continue treating both FATF black and grey list countries as presenting higher risk.
Pooled Client Accounts
The amendments retain the provisions relating to pooled client accounts and clarify the circumstances in which banks may apply simplified due diligence.
Where firms are asked to provide information regarding underlying clients, they are not required to disclose legally privileged information and doing so will not breach duties of confidentiality.
These provisions apply only to pooled client accounts established after the Regulations came into force.
Trust Registration Service
The Regulations also make several amendments to the Trust Registration Service, including changes to the operation of the de minimis exemption. Existing trusts can now be closed on the Trust Registration Service where appropriate.
Trust and Company Service Providers
The scope of the Money Laundering Regulations has been expanded to include the sale of “off-the-shelf” companies, meaning firms undertaking this work should ensure their AML procedures reflect the additional regulated activity.
What should firms review?
For most firms, the required amendments will be relatively limited. However, this is a good opportunity to review:
- your AML Policies, Controls and Procedures (PCPs);
- your Practice-Wide Risk Assessment;
- your Client and Matter Risk Assessment;
- your Enhanced Due Diligence procedures;
- your staff training materials; and
- any guidance relating to high-risk jurisdictions and the Trust Registration Service.
Keeping AML documentation up to date is an important part of demonstrating compliance with the Money Laundering Regulations and your regulator’s expectations.
If you would like assistance reviewing or updating your firm’s AML documentation following the recent amendments, please get in touch.
