The government is consulting on plans to introduce an economic crime levy, designed to raise £100m a year to boost anti money laundering (AML) capability, to be paid for by the AML-regulated sector
It is seeking views on what the levy will pay for, how it should be calculated and distributed across the AML-regulated sector, and how the levy should be collected.
The government says the size of AML activity means a co-ordinated public/private partnership is required to improve the UK’s response to economic crime. Banks, accountancy and law firms, and casinos, among others, are already required to take steps to address the risk that they are used by criminals to launder money, and the levy will form part of a long-term and sustainable resourcing model to implement the UK’s economic crime plan.
The AML-regulated sector consists of around 90,000 entities. In order to obtain a contribution from an appropriate cross-section of these firms, it has become clear the only mechanism available is a mandatory levy.
The consultation suggests it is envisaged the levy calculation could consist of three separate elements: a levy base; a small business exemption; and if possible, a money laundering risk weighting.
The consultation also includes a call for evidence on current levels of private sector investment on counter fraud measures, as well as gauging private sector views on contributions towards funding the fraud response.
The government says it will analyse responses to this consultation and respond in due course. It intends for the first set of levy payments to be made in the financial year 2022/2, but this timeline is subject to the findings of the policy consultation and the time needed to develop the necessary collection infrastructure and go through the legislative process.
The consultation closes on 14 October.