Money laundering - new regulations New money laundering regulations came into force in the UK on 1 March 2004. The regulations cover, among others, estate agents. Copies of the Money Laundering Regulations 2003 are available from The Stationery Office (www.hmso.gov.uk). Copies of the regulations and related material are available on the : <a href=www.hm-treasury.gov.uk/moneylaundering target=_blank>Treasury web site</a>
Legal advice as to whether the new regulations cover house builders is conflicting. HBF sought clarification from HM Treasury but, as the following Treasury response indicates, it is unable to offer advice:
HM Treasury is unable to give legal advice to businesses upon whether they are caught by the Regulations. It would not be right for Government to write legislation and then interpret that same legislation. It is a function for the courts to interpret legislation, and you would need to come to your own opinion upon whether you are captured by any legislation. Legal advice from other sources may of course assist you in doing this.
You also asked whether the Treasury provides guidance for those covered by the Regulations. The Treasury does not issue guidance upon the Regulations. However, there is provision within the Money Laundering Regulations 2003 and the Proceeds of Crime Act 2002 for industry guidance to be submitted to the Treasury for approval. There are a number of bodies that have produced guidance, some of which may be useful references. These include, for example:
* The Joint Money Laundering Steering Group (JMLSG), who produce guidance for financial institutions (for information on how to obtain a copy, I suggest you refer to the JMLSG website - http://www.jmlsg.org.uk/)
* Anti money laundering guides produced by HM Customs and Excise for high-value dealers and money service businesses can be found at and http://www.hmce.gov.uk/forms/notices/mlr7.htm
The Treasury has not approved the updated version of the JMLSG guidance (although it has recently been submitted to us for consideration), but it did approve the previous version. We are also aware that there are a number of other bodies that are in the process of producing guidance, such as the Law Society and the Consultative Committee of Accountancy Bodies. However, the Treasury is not in a position to endorse this guidance at this point.
Therefore it is not clear whether the regulations apply to house builders, a situation that can only be resolved by the courts. However HBF members should be aware of the new regulations and the possibility that house builders may be covered. Members should seek their own legal advice.
House builders also need to be aware of the Proceeds of Crime Act 2002 which came into effect on 24 February 2003. From 1st March 2004, Schedule 9 of the Act was amended to reflect activities covered by the Money Laundering Regulations 2003. Therefore if the Money Laundering Regulations 2003 do apply to house builders, the Proceeds of Crime Act 2002 also applies.