5th Money Laundering Directive

19 February 2020

The 5th Money Laundering Directive (5MLD) came into force on the 10th January 2020 and is set to build on the regulatory requirements under the 4th Money Laundering Directive. The purpose of 5MLD is to strengthen the UK’s financial system in order to prevent criminals laundering money and funding terrorism.

The key changes include:

• expansion of the sectors that are subject to the regulations (letting agents where monthly rent amounts to €10,000 or more; virtual currency service providers; custodian wallet providers; art traders and intermediaries where the value of the transaction or a series of linked transactions is €10,000 or more)
• broadening the criteria for assessing high-risk third countries, greater safeguards when dealing with these countries and introducing ‘super enhanced due diligence’
• changes in relation to client due diligence;
• clarification on politically exposed persons;
• changes in relation to beneficial ownership and trusts;
• changes in relation to financial services; and
• fewer information barriers for law enforcement.

 

 

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Iain Larkins