The Money Laundering Regulations 2017 reach further than many business owners realise. Beyond banks, accountants and lawyers, the regime captures letting agents on certain transactions, art market participants, and high-value dealers — all of whom must register with HMRC's Anti-Money Laundering Supervision (HMRC AMLS) and implement a full AML control framework. Non-compliance carries six-figure penalties and, increasingly, public naming.
Letting agents
Letting agents fell into scope from January 2020. The regulations capture firms acting on the letting of residential or commercial property where the monthly rent is equivalent to €10,000 or more, calculated over the term of the tenancy. The trigger is the lettings activity itself, not the wider estate agency or property management business — but in practice most lettings agencies of any size will have at least some lettings that cross the threshold.
Letting agents in scope must:
- Register with HMRC AMLS within 35 days of starting in-scope activity.
- Conduct CDD on both landlord and tenant before the tenancy begins.
- Verify identity from reliable independent sources.
- Identify beneficial owners where landlords or tenants are corporates.
- Apply enhanced due diligence where the parties or transaction are higher risk.
- Train all relevant staff and document training.
Art market participants
The art market was brought into scope from January 2020 in response to international concerns about money laundering through high-value cultural property. An "art market participant" is a firm or sole trader that trades in (or acts as an intermediary in the trade of) works of art where the value of the transaction is €10,000 or more (single transaction or linked transactions).
"Work of art" is defined by reference to VAT legislation and includes paintings, drawings, sculptures, original engravings, certain ceramics and tapestries. Auction houses, galleries, dealers, and intermediaries (including freeports providing storage with handling) can all be in scope.
Obligations mirror those for other supervised sectors — registration, risk assessment, CDD on both buyer and seller, source of funds and source of wealth checks for higher-value transactions, and a documented compliance framework.
High-value dealers
The high-value dealer category captures businesses that accept cash payments of €10,000 or more (single transaction or linked transactions), whether paid in a single payment or in instalments. This is a deliberately broad net — jewellers, car dealers, antique dealers, yacht brokers, builders' merchants, and anyone else accepting large cash payments can be caught.
The key compliance steps are:
- Register with HMRC AMLS before accepting in-scope cash payments.
- Conduct CDD on every customer paying €10,000 or more in cash.
- Document the source of cash where it is not obviously consistent with the customer's profile.
- Submit a SAR where suspicion arises.
Many high-value dealers prefer simply to refuse cash payments above the threshold — and that is a legitimate compliance strategy. But the moment a cash payment crosses the line, the full AML regime engages.
The structural approach
Whatever the sector, the architecture of compliance under MLR 2017 is the same:
- Firm-wide risk assessment documenting the specific risks the business faces.
- Policies, controls and procedures proportionate to the risks.
- Customer due diligence on every in-scope transaction.
- Ongoing monitoring of business relationships.
- SAR reporting where suspicion arises.
- Training of staff appropriate to their role.
- Record-keeping for at least five years.
- MLRO appointment at senior level.
Common compliance gaps
HMRC AMLS visits regularly identify the same gaps across sectors:
- Generic risk assessments copied from templates with no business-specific content.
- CDD files that capture identity but not beneficial ownership or source of funds.
- No documented training, or training that is one-off rather than periodic.
- MLRO not at sufficient seniority to escalate matters effectively.
- Late registration, where the firm started in-scope activity months before submitting the application.
What good looks like
A well-run AML framework is part of business operations, not a parallel compliance silo. CDD documents sit alongside the contract file. The risk assessment is reviewed when a new product or geography is added. Training is on the calendar. The MLRO has authority and visibility. When HMRC visits, the inspection is a check on a system that is already working, not a discovery exercise.
Cross-over with other compliance work
AML compliance interacts with other regulatory regimes for many of our clients. Letting agents face property redress scheme obligations and TPO/PRS compliance; art dealers face VAT margin scheme accounting; high-value dealers may face PCI compliance on card terminals. Our business advisory work routinely supports clients on the integration of these obligations into a coherent operations playbook, alongside their annual accounts and corporate reporting.
If you are unsure whether your activity is in scope of MLR 2017, or if you need help building or reviewing your AML control framework, book a call or reach us via the contact page.