What are the three stages of money laundering?
Placement, layering and integration. Placement gets criminal cash into the financial system. Layering moves it through transactions, accounts or jurisdictions to break the audit trail. Integration brings it back out looking legitimate, often through property, a cash-heavy business, or a loan repaid to the launderer.
Most staff only ever see the placement stage, which is why the course spends its time on what that looks like across a counter or a client file.
Is anti-money laundering training a legal requirement?
For businesses in the regulated sector, yes. The Money Laundering Regulations 2017 require firms to train relevant employees and agents, meaning those whose work touches customer due diligence or transactions, on the law, on relevant data protection requirements, and on recognising activity that may relate to money laundering, terrorist financing or proliferation financing, and to keep a record of that training.
Outside the regulated sector the training is not mandated, but the principal offences under the Proceeds of Crime Act 2002 apply to everyone.
What is a suspicious activity report?
A suspicious activity report, or SAR, is a disclosure made to the National Crime Agency when a person knows or suspects that property is criminal. In the regulated sector, staff report internally to the nominated officer first, and that officer decides whether to submit the SAR. The duty there covers terrorist financing too, and it bites where someone knows, suspects, or has reasonable grounds to suspect.
Reasonable grounds is a lower bar than proof. You are not expected to investigate, only to report what looks wrong.
What does a money laundering reporting officer do?
The MLRO receives internal reports, assesses them, submits SARs to the National Crime Agency, and requests a defence against money laundering where a transaction needs to go ahead. They also keep the internal records the regulations require and act as the point of contact for law enforcement.
What are the penalties for money laundering?
The principal offences under the Proceeds of Crime Act 2002, which cover concealing, arranging and acquiring criminal property, carry up to 14 years imprisonment and an unlimited fine. Failure to disclose in the regulated sector carries up to five years, and tipping off a suspect that a disclosure has been made is a separate criminal offence.
Firms also face regulatory action and the reputational damage of a public enforcement notice.
Who needs AML training?
Staff in accountancy, legal services, estate and letting agency, financial services, high value dealing and gambling, plus managers anywhere that handles large cash payments. Hospitality operators taking substantial cash meet the same warning signs, usually without a compliance function to ask.
The course runs one to two hours and ends with a CPD accredited certificate. For the wider picture on who must train and how often, see the UK anti-money laundering training guide.
