Proposed changes to AML supervision
IPA Insolvency Practitioner newsletter AML Digest, December 2025
On 21 October the UK Government announced that they were reforming the supervision of Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) in the UK.
Following a consultation on the future of AML supervision, the decision has been made that the Financial Conduct Authority (FCA) will become the Single Professional Services Supervisor (SPSS). Specifically, the FCA will assume responsibility for supervising legal, accountancy and trust or company service providers for AML/CTF purposes. Full details of the proposed reform can be found here.
The reforms will take time to introduce as there needs to initially be primary legislation passed through Parliament and there is then proposed to be a phased transfer of AML/CTF supervision from the IPA and other AML supervisors to the FCA.
What does this mean for members who are supervised for AML/CTF by the IPA?
At the moment it is ‘business as usual’. The IPA currently remains an AML Supervisory Authority and will continue to provide guidance and training for members and continue our active AML supervision of supervised members.
The IPA will continue to support and assist members to ensure that you are and remain compliant with your obligations under the MLR17 (as amended) and linked regulatory requirements.
What does this mean for members who are not supervised for AML/CTF by the IPA?
If you have concerns, you should contact your AML Supervisor to confirm their position. However, it is expected that – as with the IPA – other Supervisors will continue to support and assist their supervised members to ensure that you are compliant with the MLR17 (as amended) requirements.
What are the next steps?
The first step is that the Government have launched a consultation on the proposed duties, powers and accountability of the FCA as the SSPS.
The consultation can be found here. The consultation runs until 24 December and you still have time to make representations under the consultation.
The IPA would urge you to look at making a response to the consultation as the FCA will be your AML Supervisor at some point in the future. The IPA will be making our own representations to ensure that the move to the FCA is as seamless as possible and has minimal impact on your work.
Our proposed response will be finalised shortly. There are a number of critical areas where we have raised concerns or are seeking clarification. The main points of our response will be:
- Sector recognition – Ensuring IPs are recognised as a distinct sector, not simply bundled into “accountancy,” to preserve specialist insolvency risk expertise
- Fit and proper tests (Reg 58) – Strong concerns that FCA powers could conflict with the IPA’s existing licensing framework and statutory role under the Insolvency Act 1986
- Information sharing – Emphasising the need for robust, reciprocal information sharing between the FCA and RPBs on licensing, disciplinary matters and AML findings
- Transitional arrangements – Stressing the need for clear timelines, early engagement and maintenance of regulatory effectiveness during transition
- Ongoing collaboration – Highlighting the IPA’s sector expertise and our willingness to support the FCA in sectoral risk assessments and guidance development
The IPA will keep members updated on this important regulatory change as and when we receive updates.