anti-money laundering registration
On 15 December 2007 the Money Laundering Regulations (the
Regulations) came into force across the UK. The purpose of the
Regulations is to detect, deter and disrupt financial crime and
terrorist financing by reducing the possibility of legitimate
businesses being used for money laundering. Businesses are required
to take appropriate steps to prevent criminals using their business
as a mechanism by which to do so and to report suspicious activity
to the Serious Organised Crime Agency (SOCA).
As a result of the Regulations, the compliance of certain
businesses with their requirements under the Regulations will be
supervised by the Office of Fair Trading (OFT) and those businesses
will be required to register with the OFT. Consumer Credit
Financial Institutions (CCFIs) are one of the types of supervised
businesses who need to be registered with the OFT before 31 January
2010.
what is a CCFI?
CCFIs are defined as businesses carrying on consumer credit
lending activity who are neither authorised by the Financial
Services Authority (FSA) nor money service businesses supervised by
Her Majesty's Revenue and Customs (HMRC).
As a consumer credit lender the business should hold a consumer
credit licence for category A. However, the OFT will supervise
those business that require a category A licence whether they hold
a current licence or not.
To summarise, if you are a CCFI and hold a category A consumer
credit licence for providing consumer credit, you will need to
register with the OFT. If you hold a consumer credit licence but
not for category A and do not lend, or if despite holding a
category A licence you do not engage in lending, you will not be a
CCFI and will not be supervised by the OFT.
registration process
The OFT launched registration of businesses it supervises on 31
July 2009 and the OFT requires all supervised businesses to
register before the 31 January 2010. Failure to register could lead
to the OFT imposing a civil penalty or taking a prosecution if
business is carried on after 31 January 2010. Prosecution could
result in a sentence of up to two years in prison and/or an
unlimited fine.
In order to become registered, the registration form must be
completed together with a fee payment of £115.00 per premises for
2009/10.
The OFT have suggested that business apply for registration no
later than the end of November 2009 to avoid being caught in the
predicted peak of registration applications prior to the Christmas
period.
