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HMRC internal manual

MLR1 Penalties Guidance

Penalties guidance: specific failings and breaches of the Money Laundering regulations

Schedule 6 relevant requirements:

  • regulation 18, take appropriate steps to assess the risks a relevant person is subject to and to keep an up to date record in writing of the steps taken
  • regulation 19, establish, maintain, review, update and maintain a record in writing of policies, controls and procedures
  • regulation 20, ensure policies, controls and procedures apply to subsidiaries and branches
  • regulation 21, appoint persons responsible for compliance with the regulations and to report suspicious activity, screening of relevant staff, establish an independent audit function andrespond fully to enquiries
  • regulation 22, appoint a central contact points: electronic money issuers and payment service providers
  • regulation 24, take appropriate measures to ensure staff are appropriately trained and maintain a record in writing of training given
  • regulation 26(1), (4), (5) and (10), to ensure that prohibition and approvals requirements are complied with
  • regulation 27, basic requirement to apply customer due diligence measures
  • regulation 28,  requirement to apply customer due diligence measures and to identify, verify and assess the purpose and intended nature of a business relationship and to conduct ongoing monitoring
  • regulation 30, apply customer due diligence measures at the appropriate time
  • regulation 31(1), requirement to cease transactions
  • regulation 33(1) and (4) to (6), obligation to apply enhanced customer due diligence and enhanced ongoing monitoring
  • regulation 35, enhanced customer due diligence: politically exposed persons
  • regulation 37, application of simplified due diligence
  • regulation 38(3), customer due diligence in relation to electronic money 
  • regulation 39(2) and (4), reliance on a third party to apply customer due diligence measures
  • regulation 40(1) and (5) to (7), record keeping requirements
  • regulation 41, data protection requirements
  • regulation 43, corporate bodies obligations to provide information
  • regulation 44, trustee obligations to provide information
  • regulation 45(2) and (9), trustee obligation to provide HMRC with information
  • regulation 56(1) and (4), requirement to be registered
  • regulation 57(1) and (4), manner of and information to be provided in applications for registration in a register maintained under regulations 54 or 55
  • regulation 57, requirement to make an application for registration
  • regulation 64(2), obligations of payment service providers to take account of guidelines and respond to enquiries
  • regulation 66, requirement to provide information specified in a notice, ot to attend for interview
  • regulation 69(2), requirement to provide entry, inspection of premises without a warrant
  • regulation 70(7), requirement to provide entry of premises under warrant
  • regulation 78(2) and (5), requirement to prohibit individuals from managing

Failures in relation to the above  obligations may result in civil or criminal action.

Further details about which of these failings or breaches are connected can be found in MLR1PP7200