UK: UK Receives Top Ranking Globally For Anti-Money Laundering And Terrorist Financing Measures

Last Updated: 5 February 2019
Article by Georgina Whittington

The Financial Action Task Force (FATF) has awarded the UK its highest ranking globally for anti-money laundering (AML) and counter-terrorist financing (CTF) measures.1 In a report published in December 2018, FATF praised the UK for having "a well-developed and robust regime" in which money-laundering and terrorist finance activities are "routinely and aggressively" investigated and prosecuted.2  

Unsurprisingly, the report has been trumpeted by the government as a success for its economic crime-fighting strategy. Ben Wallace, Minister for Security and Economic Crime, declared: "The UK has taken a leading role in the global fight against illicit finance. I'm delighted with today's report which shows our efforts are being recognised".3 

The reaction of anti-corruption campaigners, in contrast, has been far from positive. A joint statement by Corruption Watch, Global Witness and Transparency International UK noted that the glowing report seemed somewhat at odds with the NCA's estimate that hundreds of billions of pounds are laundered through the UK each year.4  In the words of Global Witness, "this gold star...suggests the anti-corruption watchdog is asleep on the job."5  

The FATF report 

FATF evaluates the AML and CTF measures of thirty-six countries world-wide by the effectiveness of eleven so-called Immediate Outcomes, each covering different areas of compliance and supervision. Out of available ratings of High, Substantial, Moderate and Low, FATF awarded the UK four Highs, four Substantials and three Moderates. No areas were deemed Low. 

In addition to Immediate Outcomes, FATF uses a second, more detailed evaluation system of Technical Compliance Ratings. Out of forty technical compliance areas, the UK was judged compliant or largely compliant in thirty-eight areas. To put these ratings in international context, the UK achieved fourteen more compliant/largely compliant ratings than the USA, and seventeen more than Switzerland.

Areas requiring improvement 

In amongst the positives, however, FATF's report identified a number of weaknesses in the UK's AML/CTF regime. Areas singled out as requiring improvement were as follows:  

a) Suspicious Activity Reports (SARs)

FATF considered the UK's SAR regime to require "a significant overhaul."6  The report highlighted widely-recognised failings such as the low level of SAR reporting in sectors such as law, accountancy and real estate, as well as the "poor quality" of a significant number of SARs filed. FATF also noted that it had "serious concerns" about the SAR online reporting tool, which it considered to be insufficiently adapted for use by non-banks. As a "priority action", FATF therefore recommended that the UK "prioritize reform of the SAR regime, including by modernising reporting mechanisms."

b) UK Financial Intelligence Unit 

Linked to the poor quality of SARs, FATF singled out the UK Financial Intelligence Unit (UKFIU)7 as a "serious concern."8  FATF noted that the UK had pursued a "deliberate policy decision to limit the role of the UKFIU in undertaking operational and strategic analysis"; as a result, it suffers from a lack of human and IT resources which means that financial intelligence is inadequately exploited. To remedy this, FATF recommended that the UK "substantially increase" both the human resources available to the UKFIU and its IT capacity.

c) Persons of Significant Control (PSC) Register 

FATF also raised concerns regarding the PSC Register, set up in 2016 to create transparency as to the ultimate controllers of UK-incorporated companies.9  FATF noted that although the information on the register "is subject to basic checks, it remains largely unverified", while "individuals and entities are not screened against targeted financial sanctions lists when registering companies." 

d) Supervision

Finally, FATF identified "significant weaknesses" in supervision by the twenty-two legal and accountancy sector supervisors, deeming their understanding of money-laundering / terrorist-financing risk to be "highly variable."10  Although noting that OPBAS had been established to address these concerns, FATF recommended that that the UK "closely monitor" OPBAS in the performance of this work going forward. 

Reactions to the report

Critics of the report clearly consider that FATF did not go far enough in flagging concerns. In their joint statement, Corruption Watch, Global Witness and Transparency International UK deemed the UK's "Substantial" rating for the investigation/prosecution of money laundering to be "generous", pointing to (i) the low number of convictions for failure to disclose money laundering (despite under-reporting in the legal, real estate and accountancy sectors) and (ii) the fact that "no bank has ever been prosecuted in the UK for its role in money laundering" despite "the mention of large UK banks in many money-laundering scandals."11 

The anti-corruption NGOs levelled further criticism at FATF's verdict on Companies House. In particular, FATF's mention of Companies House using sanctions as a last resort for non-compliance was deemed to "grossly understate the poor track record of enforcement of the rules"; to date, the sole prosecution for false filings is that of an individual who expressly incorporated fictitious companies to highlight Companies House verification failings.12   

In short, anti-corruption campaigners have warned against FATF's favourable report inducing government "complacency" when they consider there is still much to be done.13

The government has naturally welcomed FATF's overall positive assessment. Although it remains to be seen whether it will take FATF's recommendations on board, a number of issues flagged were in fact already acknowledged as failings and in the early stages of being addressed. In October 2018, for example, the Minister for State and Security announced a crackdown on the "facilitators" of economic crime, including a drive to increase the number of SARs filed in the accountancy, real estate and legal sectors. Indeed, improvements in this area already seem to be underway; at the end of 2018, the NCA reported a year-on-year increase in SAR filings of 32% from estate agents and 13% from accountants.14 

As for FATF's concerns regarding the UKFIU, the Economic Secretary to the Treasury, John Glen, stated in response that that "the NCA is increasing the staffing of the UKFIU by more than 30%...with further increases envisaged in future years."15 He added that "an improved IT system" would also be provided to help process and analyse SARs. Glen further announced that the government plans to legislate in 2019 to introduce a register of beneficial ownership for overseas entities which own or purchase UK property. 

Concluding his statement, Glen noted that FATF's report "underlines where more work can be done and will help to focus these efforts over the coming years."16  We await the government's full response to the report which it has stated will be published in due course.17 It seems likely, however, that we will see the weaknesses identified by FATF prioritized in the next few years. 


1 FATF is an inter-governmental body established in 1989 to set standards and promote the implementation of legal and regulatory measures for combating money laundering and terrorist financing. Thirty-six jurisdictions are currently members of FATF (including most major financial centres across the world). 

2 Please see an executive summary of FATF's report at  


4 See joint statement at Bond_Anti-Corruption_Group_FATF_briefing.pdf


6 See pages 4 and 6 at  

7 The UKFIU is the body responsible for the gathering, analysis and dissemination of the financial intelligence received from SARs.

8 See pages 4 and 6 at  

9 See page 11 at

10 See pages 9 and 12 at

11 See joint statement at Bond_Anti-Corruption_Group_FATF_briefing.pdf.

12 To date, the sole prosecution for false filings is that of Kevin Brewer, who incorporated fictitious companies with the express purpose of highlighting Companies House verification failings; see joint statement at Bond_Anti-Corruption_Group_FATF_briefing.pdf.


14 Although the legal sector bucked this trend with a year-on-year decrease of 12%.


16 Ibid.

17 Ibid.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Topics
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions