UK FCA AML and Financial Crime Regulatory Timeline 2026-2028: What Firms Must Prepare For
- Jan 26
- 9 min read
UK FCA AML and Financial Crime Regulatory Timeline 2026-2028: What Firms Must Prepare For
The UK's AML and financial crime landscape is undergoing the most significant transformation in a decade. Between 2026 and 2028, payment institutions, EMIs, banks, and other regulated firms face a wave of regulatory changes that will fundamentally reshape compliance obligations, supervisory structures, and enforcement priorities.
The FCA has made financial crime its top strategic priority for 2025-2030, with financial crime investigations accounting for 74% of all FCA enforcement cases opened in 2024/25. For firms, these changes aren't optional upgrades - they're mandatory transformations that require immediate planning and investment.
UK FCA AML and Financial Crime - Why This Timeline Matters
Unlike incremental regulatory adjustments, the 2026-2028 period brings structural changes across three critical dimensions:
Legislative Reform: Major amendments to the Money Laundering Regulations addressing customer due diligence, cryptoassets, and digital identity verification.
Supervisory Consolidation: The FCA becomes single supervisor for professional services firms currently supervised by 23 separate bodies.
Operational Requirements: New transparency obligations under ECCTA, enhanced beneficial ownership requirements, and stricter identity verification standards.
Firms that wait until implementation deadlines will face rushed, expensive compliance projects. Those that start now can implement changes systematically while maintaining operational continuity.
Early 2026: Money Laundering Regulations Amendment
What's Changing
HM Treasury published draft amendments to the Money Laundering Regulations in September 2025 for technical consultation. The final statutory instrument is expected to be laid before Parliament in early 2026.
Key Changes Include:
Enhanced Due Diligence Narrowing
EDD requirements will focus on "unusually complex" transactions rather than all complex transactions. For high-risk third countries, EDD will be limited to jurisdictions on FATF's "Call for Action" list (the FATF black list only), though firms must still assess whether other jurisdictions present high money laundering risk.
Pooled Client Accounts
Decoupled from simplified due diligence framework with new specific criteria for offering pooled accounts. Financial institutions won't need to conduct full CDD on all underlying clients in pooled structures.
Cryptoasset Firm Alignment
MLR requirements aligned with new FSMA authorization framework for cryptoassets. Firms authorized under FSMA will no longer need separate MLR registration as cryptoasset exchange providers or custodian wallet providers. This takes effect when the FSMA cryptoasset perimeter commences in 2027.
Digital Identity Verification
New guidance on using digital identities for MLR checks, providing clarity on definitions and interaction with the digital identity trust framework under the Data (Use and Access) Act 2025.
Currency Conversion
Monetary thresholds converted from euros to sterling, simplifying compliance calculations.
Trust and Company Service Providers
Must conduct CDD across all services, including "off-the-shelf" company sales.
Action Required
By Q1 2026:
Review and update AML policies to reflect new EDD triggers
Update customer risk assessment methodologies
Assess digital identity verification capabilities
Update staff training materials
For cryptoasset firms: Plan for transition to FSMA-only regime
Spring 2026: Companies House Identity Verification Enforcement
What's Changing
Under the Economic Crime and Corporate Transparency Act 2023 (ECCTA), Companies House will enforce identity verification for all presenters of information by spring 2026. This makes identity verification compulsory for filing any document at Companies House.
New restrictions on who can file documents on behalf of companies also take effect.
What This Means
Any person filing documents at Companies House must complete identity verification. This affects:
Company directors and secretaries
Persons with significant control (PSCs)
Anyone filing on behalf of a company (agents, accountants, lawyers)
Action Required
By Spring 2026:
Ensure all authorized persons have completed identity verification
Update internal processes for Companies House filings
Review third-party filing arrangements
Train staff on new filing restrictions
Mid-2026: Economic Crime Plan 2 Reporting
What's Happening
HM Treasury's third progress report on Economic Crime Plan 2 (ECP2) is expected by June 2026. This will assess implementation of the government's approach to reducing economic crime and safeguarding national security.
The September 2025 progress report showed:
36% increase in money laundering prosecutions (2024 vs 2023)
7% increase in money laundering convictions
32,000 entities registered on Companies House Register of Overseas Entities
The June 2026 report will provide updated metrics and identify remaining implementation gaps.
Action Required
Ongoing:
Monitor progress reports for emerging regulatory priorities
Assess firm's alignment with ECP2 objectives
Prepare for potential new requirements based on identified gaps
End 2026: Companies House Identity Verification Compliance
What's Changing
By the end of 2026, Companies House should complete the 12-month transition period for all individuals on the register requiring identity verification.
Companies House will begin compliance activity against those who have failed to verify their identity, potentially including:
Removal from the register
Restrictions on filing
Enforcement action
Action Required
By December 2026:
Ensure all directors, PSCs, and relevant persons have completed verification
Audit company records to identify any missing verifications
Implement monitoring to catch new appointments requiring verification
Develop contingency plans for directors/PSCs who fail to verify
End 2026: Limited Partnership Transparency
What's Changing
Enhanced transparency requirements for Limited Partnerships are expected before the end of 2026.
This follows concerns about Limited Partnerships being exploited for money laundering and opacity in ownership structures.
Action Required
Throughout 2026:
Monitor for publication of specific requirements
Review Limited Partnership structures for beneficial ownership clarity
Prepare for enhanced disclosure obligations
Update due diligence processes for Limited Partnership customers
2027: Cryptoasset FSMA Perimeter Implementation
What's Changing
The FSMA cryptoasset authorization framework commences in 2027, bringing cryptoasset activities within FCA's regulatory perimeter.
From this date:
Cryptoasset firms must be FCA-authorized under FSMA
Separate MLR registration as cryptoasset exchange provider or custodian wallet provider no longer required
Enhanced FCA supervision and enforcement powers apply
Consumer protection requirements extend to cryptoassets
What This Means for Cryptoasset Firms
New Obligations:
Full FCA authorization (not just MLR registration)
Financial promotions compliance
Consumer protection requirements
Prudential requirements
Operational resilience standards
Enhanced AML/sanctions controls
For Firms Dealing with Cryptoasset Firms:
Due diligence processes must verify FCA authorization
Risk assessments should reflect new regulatory framework
Transaction monitoring rules may need recalibration
Action Required
Throughout 2026-2027:
Cryptoasset firms: Prepare full FCA authorization applications
All firms: Update customer due diligence for cryptoasset exposure
Review and update risk assessments for crypto-related risks
Enhance transaction monitoring for crypto-related activities
Update training on crypto money laundering typologies
2027: ECCTA Full Implementation
What's Changing
While many ECCTA provisions are already in force, implementation activity and transitional periods continue until completion in 2027.
Key Provisions Completing in 2027:
Accounts Disclosure Reforms
Expected April 2027 - enhanced requirements for company accounts disclosure at Companies House.
Failure to Prevent Fraud Maturity
The new corporate offense (effective September 2025) will have bedded in, with enforcement examples emerging and regulatory guidance evolving based on early experience.
Corporate Criminal Liability
Expanded "identification doctrine" will be fully operational - if a senior manager commits economic crime within scope of their authority, the company may be held liable.
Action Required
Throughout 2027:
Monitor guidance updates on failure to prevent fraud
Ensure fraud prevention procedures remain robust and documented
Track enforcement cases for emerging standards
Prepare for enhanced accounts disclosure requirements
Review senior manager conduct standards and accountability frameworks
TBD: FCA Becomes Single Professional Services Supervisor
What's Changing
HM Treasury announced in October 2025 that the FCA will become the Single Professional Services Supervisor (SPSS) for AML/CTF supervision of:
Legal service providers
Accountancy service providers
Trust and company service providers
This consolidates responsibilities from 23 separate Professional Body Supervisors into the FCA.
When This Happens
Implementation timeline depends on:
Passage of enabling legislation
Confirmation of funding arrangements
Development of detailed transition and delivery plan
Availability of parliamentary time
Given these dependencies, implementation date is uncertain but unlikely before late 2027 at the earliest.
What This Means
For Professional Services Firms:
FCA will become AML/CTF supervisor (Professional Bodies retain other regulatory functions)
FCA supervisory standards and expectations will apply
Potentially more intensive supervision than current regime
Higher supervisory fees expected
Data requests and thematic reviews aligned with FCA's financial services approach
For Firms Using Professional Services:
Enhanced confidence in advisors' AML compliance
Potential for improved information sharing
More consistent standards across professional services
Action Required
2026-2027:
Professional services firms: Monitor legislation progress closely
Begin alignment with FCA expectations on financial crime controls
Review adequacy of current AML frameworks against FCA standards
Prepare for enhanced data collection and MI requirements
Budget for likely fee increases
All firms: Understand implications for professional advisors used
2028: FATF Mutual Evaluation of UK
What's Happening
The Financial Action Task Force (FATF) will publish its Mutual Evaluation Report of the UK in 2028.
This comprehensive assessment evaluates:
Technical compliance with FATF Recommendations
Effectiveness of UK's AML/CTF/CPF framework
Implementation of previous FATF recommendations
National risk assessment quality
Supervisory effectiveness
Law enforcement capabilities
The UK was last assessed in 2018. The 2028 evaluation will assess the transformed landscape including MLR reforms, ECCTA implementation, supervisory consolidation, and FCA enforcement activity.
Why This Matters
FATF ratings affect:
UK's international reputation for financial crime controls
Cross-border banking relationships and correspondent banking
International investment confidence
Regulatory priorities and resource allocation
Pressure for further legislative changes
Poor ratings drive:
Enhanced due diligence requirements for UK-connected transactions globally
Increased compliance costs for UK firms operating internationally
Reputational damage affecting London's position as financial center
Action Required
2026-2028:
Understand FATF expects effectiveness, not just technical compliance
Ensure your controls work in practice, not just on paper
Document effectiveness through management information
Prepare for potential requests for case studies/data from authorities
Expect heightened regulatory scrutiny as evaluation approaches
Ongoing: Enhanced FCA Supervisory Activity
What's Happening
Throughout 2026-2028, firms should expect:
Data-Led Supervision
FCA uses advanced analytics to identify firms with concerning patterns before conducting assessments.
Thematic Reviews
Multi-firm reviews on specific topics (transaction monitoring, sanctions, fraud prevention, cryptoassets).
Dear CEO Letters
Sector-wide communications identifying common failings and setting expectations.
Skilled Person Reviews
Section 166 requirements for independent assessments where weaknesses identified.
Voluntary Requirements (VREQs)
Business restrictions on firms with control failures (customer onboarding limits, transaction caps).
Enforcement Actions
Substantial fines, public censures, license restrictions for serious failures.
Action Required
Continuous:
Maintain robust financial crime frameworks
Conduct regular independent effectiveness reviews
Stay current with FCA guidance updates (Financial Crime Guide updated November 2024)
Respond promptly to FCA information requests
Self-report issues discovered in line with Principle 11
Ensure senior management oversight and accountability under SMCR
Key Dates Summary
Early 2026:
Final Money Laundering Regulations amendments laid before Parliament
Spring 2026:
Companies House identity verification enforcement begins
June 2026:
Economic Crime Plan 2 third progress report
Throughout 2026:
Limited Partnership enhanced transparency requirements
End 2026:
Companies House completes 12-month identity verification transition
Compliance activity begins against non-verified individuals
2027:
FSMA cryptoasset perimeter commences
Cryptoasset MLR registration requirement removed for FSMA-authorized firms
ECCTA implementation completes
April 2027:
Companies House accounts disclosure reforms
Late 2027 onwards:
FCA Single Professional Services Supervisor (subject to legislation)
2028:
FATF Mutual Evaluation Report published
How Buckingham Capital Consulting Helps Firms Navigate Regulatory Change
Since 2013, Buckingham Capital Consulting has specialized in financial services regulation for payment institutions, electronic money institutions, and other regulated firms. We help clients stay ahead of regulatory change and implement new requirements efficiently.
MLR Amendment Implementation
What We Do:
Analyze impact of MLR amendments on your specific business
Update policies and procedures to reflect new requirements
Revise customer risk assessment methodologies
Implement digital identity verification capabilities
Develop staff training programs
For cryptoasset firms: Plan FSMA authorization transition
ECCTA Compliance
What We Do:
Assess failure to prevent fraud exposure and defense readiness
Develop and document fraud prevention procedures
Implement identity verification processes for Companies House
Ensure beneficial ownership transparency
Advise on corporate criminal liability implications
Prepare for enhanced accounts disclosure requirements
FCA Supervisory Preparation
What We Do:
Conduct gap analyses against FCA expectations
Prepare firms for thematic reviews and data requests
Support responses to Dear CEO letters
Manage skilled person review projects
Develop remediation plans for identified weaknesses
Provide interim MLRO support during transformation
Professional Services Transition Planning
What We Do:
For professional services firms: Prepare for FCA supervision
Assess current frameworks against FCA standards
Identify gaps and prioritize remediation
Implement enhanced MI and reporting capabilities
Develop transition project plans
For all firms: Assess implications for professional advisors used
Regulatory Intelligence and Advisory
What We Do:
Monitor legislative and regulatory developments
Provide timely updates on implementation timelines
Assess impact of changes on your business
Recommend proactive compliance strategies
Support regulatory engagement and applications
Why Choose Buckingham Capital Consulting
Specialist Expertise: Over 14 years focused on payment institutions, EMIs, and financial services regulation.
Regulatory Intelligence: We monitor all developments and understand FCA priorities.
Practical Implementation: We don't just analyze requirements - we help you implement them.
Proportionate Approach: Solutions tailored to your firm's size and complexity.
Proven Track Record: Successfully supported numerous firms through major regulatory changes.
End-to-End Service: From impact assessment through implementation to ongoing compliance.
Start Preparing Now
The 2026-2028 regulatory timeline requires significant investment in systems, processes, people, and governance. Firms that start preparation now will:
Spread costs over longer period
Avoid last-minute rushed implementation
Minimize business disruption
Demonstrate proactive compliance to regulators
Identify and remediate gaps before regulatory review
Build competitive advantage through superior controls
Firms that wait face:
Compressed implementation timelines
Higher costs from urgent procurement and resources
Operational disruption from multiple concurrent projects
Regulatory criticism for reactive approach
Risk of VREQs or enforcement if inadequate at deadline
The regulatory landscape is changing fundamentally. The firms that thrive will be those that view these changes not as compliance burdens but as opportunities to strengthen controls, enhance operational resilience, and demonstrate regulatory leadership.
Contact Buckingham Capital Consulting today to discuss how we can help you navigate the 2026-2028 AML and financial crime regulatory timeline. With over a decade of specialist expertise, we help you implement changes efficiently while maintaining business continuity and satisfying regulatory expectations.
