Financial crime regulatory developments: June 2026

Summary: The Money Laundering and Terrorist Financing (Amendment) Regulations 2026 introduce targeted updates to the UK AML regime. Key changes include clarifying when Enhanced Due Diligence (EDD) is required, with EDD now applying to transactions that are unusually complex or unusually large. Mandatory jurisdiction-based EDD has been narrowed to FATF "Call for Action" countries. Monetary thresholds have been converted from euros to sterling, the sale of off-the-shelf companies is now within the scope of TCSP activities, information-sharing and supervisory collaboration powers have been enhanced, and change in control requirements for MLR-registered cryptoasset businesses have been aligned with the wider FSMA framework.

Impact: The amendments reinforce a risk-based approach to AML compliance. Firms should review their AML frameworks to ensure controls are proportionate, effective and tailored to their specific financial crime risks. Firms will also need to demonstrate that their AML controls operate effectively in practice and are appropriately evidenced and recorded.

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Summary: The FCA required Euro Exchange Securities to cease carrying out regulated electronic money and payment services due to significant financial crime risks. The FCA identified concerns about the way the firm operated its business, including systemic weaknesses in its financial crime framework, safeguarding arrangements, and ownership and governance. The appointment of interim managers was made by the Court under the Payment and Electronic Money Institution Insolvency Regulations 2021.

Impact: This highlights the FCA’s willingness to intervene when firms fail to meet expected standards for financial crime prevention, governance and safeguarding, particularly where weaknesses could impact both consumers and the integrity of the market.

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Summary: The FCA has finalised the UK's new crypto asset regulatory framework, introducing authorisation requirements and regulatory standards for firms carrying out regulated crypto asset activities. The new regime will come into force on 25 October 2027

Impact: Crypto firms including trading platforms, intermediaries, custodians, stablecoin issuers, and firms arranging staking must obtain FCA authorisation to operate in the UK.

Applicable firms should engage in pre-application support meetings and apply for authorisation between 30 September 2026 and 28 February 2027, ahead of the regime coming into force on 25 October 2027.

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Summary: The FATF June 2026 Plenary introduced several significant updates to global AML/CFT controls. Bosnia, Herzegovina and Iraq were added to the FATF's list of jurisdictions under increased monitoring (the "grey list"), while Algeria and Namibia were removed following improvements, including successful on-site visits. FATF also updated Recommendation 6 to incorporate humanitarian exemptions within sanctions regimes, ensuring that sanctions measures do not unintentionally disrupt the flow of legitimate aid. The Plenary additionally approved initiatives focused on information sharing, payment transparency, virtual assets and emerging financial crime risks.

Impact: Firms should review their risk assessments to reflect the latest FATF updates, including the addition of Bosnia and Herzegovina, and Iraq to the FATF grey list. HM Treasury subsequently updated its High-Risk Third Countries advisory notice to reflect these changes and firms should ensure relevant customer due diligence and monitoring controls remain aligned.

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Summary: The UK's OFSI and the US OFAC held their latest strategic dialogue under the enhanced partnership, reinforcing their joint commitment to ensuring sanctions are administered in an effective and clear way. The dialogue focused on enforcement, cross-border cooperation, sanctions policy development, and the use of new technologies to enhance sanctions implementation. A key outcome was the publication of joint guidance, The U.S. and UK Economic Sanctions Authorities: A Comparative Overview, which compares the UK and US sanctions regimes and provides greater clarity on sanctions lists, licences, record-keeping and reporting requirements.

Impact: The joint guidance should provide firms with greater clarity on the UK and US sanctions requirements, helping support more consistent compliance and a better understanding of obligations across both regimes.

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