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HMRC internal manual

Money Laundering Regulations: Registration

Fit and Proper Test: What is tested?

We must be satisfied that the persons listed in MLR2R5150 have met the requirements set out in the Regulations. The test involves checking internal and external information sources, at the time of registration, to establish that the person is fit and proper under the MLR 2017.

The fit and proper test is made up of three parts:

  • Part one will test whether an applicant has an unspent conviction for a relevant offence. An applicant that has an unspent conviction as listed in schedule 3 of the Regulations will automatically fail the fit and proper test
  • Part two looks at history of failure to comply with the money laundering regulations (2017, 2007, 2003 or 2001) - a judgement issue
  • Part three is discretionary and will look more widely at a person’s:
    • honesty and integrity
    • competence and capability
    • financial soundness including tax affairs.

 

A conviction for any of the offences listed in part one is to be disregarded if it is spent under the Rehabilitation of Offenders Act 1974.

The list of schedule 3 “relevant offences” and explanation of the full width of the discretionary test can be found in Appendices 1 & 2 of  the Fit and Proper test and Approval Guidance.