On 10 November 2016, the FCA published a speech given by Rob Gruppetta, head of the FCA’s financial crime department, on the FCA’s financial crime priorities.
In the speech, Mr Gruppetta provides an overview of current FCA financial crime initiatives, including:
- Potential reforms to anti-money lending (AML) regulation. The FCA is raising various potential reforms with the government with the aim of saving costs to industry. These include considering whether transaction monitoring might be reformed, whether criminal liability being attached to the money laundering reporting officer (MLRO) role leads to overly defensive reporting and whether there should be limited relaxation of the reliance provisions in the Money Laundering Regulations 2007 (SI 2007/2157) (MLRs).
- Random sampling. The FCA will soon begin inspecting a random sample of firms that it supervises under the MLRs, including businesses such as financial advisers, stockbrokers, safe deposit box providers and life insurers. It intends to review about 100 firms each year. The FCA aims to raise standards, to help it obtain a better picture of risks posed by different sectors and to obtain assurance that its assessment of risk is correct.
- Financial crime data returns. In July 2016, the FCA finalised its rules on the introduction of a financial crime report (REP-CRIM). Mr Gruppetta states that the FCA plans to publish aggregated data from the return in due course and suggests that this may provide some benefits to firms, such as through obtaining information on how the industry generally assesses risks.
- Financial crime guide. In 2017, the FCA will update its Financial Crime Guide (FC) in response to the UK regulations implementing the Fourth Money Laundering Directive ((EU) 2015/849) (MLD4), which will repeal the MLRs. These revisions will include material on how to distinguish Between Higher-Risk And Lower-Risk Politically Exposed Persons (Peps), as required by section 30 of the Bank of England and Financial Services Act 2016.
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