money-laundering

TACT Responds to HM Treasury Consultation on the Transposition of the Fifth Money Laundering Directive

By way of background TACT – The Association of Corporate Trustees is the membership organisation of the UK corporate trustee sector. Its members include trust companies owned by banks and major financial institutions, as well as those set up by firms of accountants, lawyers and pensions professionals.

HM Treasury Consultation on the Transposition of the Fifth Money Laundering Directive

There is a general concern that the registration requirements that will be imposed by 5AMLD will overload the national trust register with a significant number of small irrelevant trusts.

The registration of the considerable number of trusts currently not subject to taxation in the UK will place a significant and immediate administrative burden on practitioners with the potential of taking the focus away from the purpose of AML risks. With the scope of registration now being so wide it will have an impact on individuals who will attempt to register trust structures but will not understand all of the requirements to do so correctly. Therefore, the government software and process for the registration of trusts needs to be as simple as possible to reduce unnecessary administration and make registration easy for the general public without impacting on the minimum statutory requirements.

There is already evidence that UK trusts are considered to be a low AML risk.

It is considered that there will be millions of UK trusts that will now require registration. Most organisations who deal with the creation or administration of trusts will comply with the new registration requirement. However, where pre-5AMLD dormant trusts come to light years later and a practitioner/adviser discovers that their client has not registered their trust it is hoped that the penalties for not registering will not be disproportionate.

Download TACT’s response to the consultation

For a copy of TACT’s response to the consultation click here.

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