Following the implementation of the Money Laundering Regulations, certain business activities have to be registered with the FCA merely to comply with the regulations. These activities include:
- Lending and financial leasing.
- Money transmission services.
- Issuing and administering means of payment.
- Firms offering guarantees and commitments.
- Trading of own account or for the account of customers in certain financial instruments.
- Participation in securities issues and the provision of services related to such issues.
- Advice to undertakings on capital structure, industrial strategy and related questions and advice as well as services related to mergers and acquisitions.
- Money broking.
- Portfolio management and advice.
- Safekeeping and administration of securities.
- Safe custody services.
Registered businesses only need to have their compliance with the Money Laundering Regulations scrutinised by the relevant regulator.
Authorised firms, however, are businesses such as banks, insurance companies and financial advisers that are regulated already under the Financial Services and Markets Act 2000 and all aspects of their regulated activities are scrutinised.
There are two other differences between registered businesses and firms authorised by the financial regulators:
- Registered businesses are not members of the Financial Services Compensation Scheme. If a customer of a registered business loses money, the customer won’t be able to seek compensation from the scheme.
- Secondly, if a customer becomes involved in a dispute with a registered business, the customer will not be able to approach the Financial Ombudsman Service to help resolve the disagreement.