Money Laundering and Terrorist Financing (Amendment) Regulations 2026 laid in Parliament
1 April 2026
HM Treasury has laid the Money Laundering and Terrorist Financing (Amendment) Regulations 2026 in Parliament. This Statutory Instrument (SI) implements the package of reforms set out in the Government’s response to its consultation on Improving the Effectiveness of the Money Laundering Regulations.
Subject to debate in the House of Lords and Commons, the majority of the provisions in the statutory instrument are expected to come into force in late June or early July 2026, with the remainder in 2027.
Key changes relevant to the insolvency profession:
High risk third countries
The obligation to apply Enhanced Due Diligence (EDD) under regulation 33(b) will be narrowed to jurisdictions subject to a FATF Call to Action – currently Iran, North Korea and Myanmar. Importantly, countries subject to FATF increased monitoring will continue to be a relevant risk factor under regulation 33(6)(c), so firms should not reduce their vigilance in respect of those jurisdictions.
Enhanced Due Diligence trigger: Complex or large transactions
The EDD trigger under regulation 33(1)(f)(i) has been refined so that it applies where a transaction is unusually complex or unusually large. This is a subtle but practically important change, and firms should review their policies and procedures to ensure the language and thresholds applied reflect the amended wording.
Pooled client accounts
Firms operating pooled client accounts must assess the level of money laundering and terrorist financing risk associated with customers using those accounts and take reasonable steps to manage and mitigate those risks. Firms should review their existing simplified due diligence assessments in light of this requirement.
Currency thresholds
Thresholds previously expressed in euros have been updated to pounds sterling. Firms should check their policies, procedures and systems to ensure references to monetary thresholds are updated accordingly.
Trusts Registration Service
Amendments have been made to the Trusts Registration Service (TRS) provisions, including changes to the de minimis limit. Firms involved in trust work should review the updated provisions carefully.
Insolvency-specific change: Regulation 30ZA: Insolvent bank customers
A new provision has been inserted which allows credit institutions to open accounts for and permit transactions by customers of an insolvent bank before completing full customer due diligence. Full CDD must then be completed as soon as practicable. This provision applies where a bank insolvency order has been made under the Banking Act 2009.
What practitioners and firms should do now
Whilst the SI is not yet in force, we encourage practitioners and firms to:
- Familiarise themselves with the changes and assess which might be relevant to their business
- Begin reviewing and updating policies, procedures and risk assessments where needed
- Consider how changes will be communicated to staff through training
The IPA will provide further guidance to members, but in the meantime you can access the draft SI and accompanying Explanatory Memorandum via the links below.