On January 23, 2025, the UK Financial Conduct Authority released, “Assessing and reducing the risk of Money Laundering Through the Markets (MLTM)” to assist brokers and other firms that operate in the capital markets to enhance their controls and meet required anti-money laundering (“AML”) standards. The FCA found gaps in wholesale brokers’ AML programs and recommended that they make improvements to their internal systems, controls, risk awareness, and training. While the FCA found that progress had been made since 2019 in several areas, including customer risk assessments, onboarding processes, and governance and oversight, certain AML deficiencies were identified, including:
- Firms underestimating the money laundering risks they are exposed to
- An inappropriate reliance on other parties in the transaction chain to complete appropriate due diligence checks on customers
- Limited information sharing between firms, and
- Limited awareness of money laundering through the markets suspicious activity reports (“SAR”) glossary code.
FCA Press Release | FCA – Assessing and reducing the risk of Money Laundering Through the Market (MLTM)