The latest amendments to the Money Laundering Regulations are effective as of 30th June 2026, marking the implementation of several targeted changes that affect all regulated businesses.

Read our previous article here, detailing those changes: MLR 2026 Amendments: What Law Firms Need to Know.

In publishing its guidelines, the Law Society confirmed that firms should ensure their policies, controls and procedures (PCPs), risk assessments, and training reflect the updated requirements. While these amendments are not a complete overhaul of the Money Laundering Regulations, they do reinforce the importance of applying a genuinely risk-based approach to compliance.

For further information on the 2026 amendments, including guidance from the SRA and the Law Society, review the resource links below:

The Law Society – lawsociety.org.uk: Money Laundering Regulations review

SRA News – sra.org.uk: Government to amend money laundering regulations

For those firms on our fully managed services, your compliance manager will have been in touch to discuss the changes to your policies, controls and procedures, including your client care letters and engagement terms.

A Reminder of The Key Changes

The amendments include:

• Revised enhanced due diligence requirements for unusually complex or unusually large transactions
• Changes to the treatment of high-risk third countries, limiting mandatory EDD to jurisdictions on the FATF Call for Action list*
• Sterling replacing euro-denominated monetary thresholds
• Revised requirements for pooled client accounts
• Wider changes affecting trust registration, information sharing and other technical areas of the Regulations

We covered these changes in detail in our previous article: MLR 2026 Amendments: What Law Firms Need to Know.

If you have not yet reviewed the practical impact on your firm’s AML framework, we recommend reading that article alongside the Law Society guidance.

*The FAFT high risk countries list has been updated as of 26^th June, details can be found here: High-risk third countries for AML purposes | The Law Society.

What Firms Must Do Now

The amendments are intended to make the AML regime more proportionate, but that does not reduce firms’ compliance responsibilities. Regulators are likely to expect firms to demonstrate that:

• AML policies and procedures have been reviewed and updated where appropriate
• Risk assessments reflect the updated regulations
• Staff have received appropriate training
• Decisions around customer due diligence and enhanced due diligence are supported by clear risk-based reasoning and documented accordingly

Supervisors are likely to focus on how firms have interpreted and implemented the revised requirements, so the audit trail matters as much as the changes themselves.

Regulatory Guidance and Support from Industry Experts

For those firms on our fully managed services, your compliance manager will have been in touch to discuss the changes to your policies, controls and procedures, including your client care letters and engagement terms.

For firms not already on one of our compliance services, if you believe your firm may be at risk, or wish to confirm your firm is achieving the required standard, RACO provides a range of solutions, including:

• Detailed Risk Management and Compliance Review – which provides firms with a structured, firm-wide gap analysis of your approach to risk, supervision, and regulatory compliance. Designed for law firms and professional indemnity insurers, the review delivers a comprehensive evaluation of your current framework, identifies areas of exposure and sets out clear, pragmatic recommendations for improvement.
• Client Due Diligence & Risk Assessment Service – our Due Diligence and Risk Assessment Service is designed to provide an outsourcing option for the completion of Client Due Diligence and completion of the Client and Matter Risk Assessment, including, where necessary, perform source of funds and source of wealth and enhanced due diligence.
• Auditing and File Reviews – procedural staff, systems, and files to ensure the procedures are up to the required standard and being implemented at case level with a report of the outcome.
• Training – whether you seek training on a 1-2-1 or group basis, online or in person at your chosen location, RACO has a range of training courses and mentoring programs to suit any legal practice. We can also design bespoke courses tailored to your firm’s needs. We have provided training to firms of all sizes, and our clients range from sole practitioners and CLC practices to multi-service firms with overseas offices.
• Packaged Solutions – Implementation of robust solutions to ensure the firm achieves compliance and then maintains compliance through the provision of ongoing support and assistance: –

• SRA Compliance Essentials – SRA Compliance Essentials gives you ongoing, specialist support to meet SRA Standards and Regulations and, where relevant, Anti-Money Laundering Regulations. It’s designed to give you peace of mind and free up time, while helping you demonstrate a robust compliance environment to the SRA and insurers.
• Fully Outsourced Risk and Compliance Management – Dedicated, day-to-day risk and compliance management for law firms. The Risk & Compliance Management service provides your firm with an outsourced compliance team, delivering structured register administration, regulatory guidance and monthly reporting to support your COLP, COFA and MLRO. Designed to ensure ongoing oversight, documented monitoring and clear evidence of effective compliance management.

Speak to Our Compliance Specialists

For more information about the Regulation and Compliance Office and to discuss how we may be able to assist in accelerating your risk management, compliance, or regulation, or to simply keep this up to date, please call us on 0203 985 8550, complete the online enquiry form below, or email us at info@regulationandcomplianceoffice.co.uk.