ECSH33035 - Inspecting cash

Cash (as defined in regulation 3) can be inspected where a business is supervised for anti-money laundering supervision under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLR 2017). A request can be made informally, however, if the business refuses, follow guidance below under the heading “What to do if the business refuses the cash inspection”.  

 This ismost commonly done during visits tomoney service businesses (MSBs) and high value dealers (HVDs) where a business confirms that it deals in cash. It may also be relevant to visits to other types of business depending on the business model and activities. For example, you may wish to inspect cash held on the premises of a letting agency business (LAB) or art market participant (AMP). 

You must understand the business model and how cash is processed following the guidance below. You must also have an awareness of the risks which will allow you to ask relevant questions and challenge the business appropriately during your compliance visit.These are published in the National Risk Assessment and in the sector specific risk and strategy documents which can be found in the Knowledge Library. You must ensure you are aware of the risks associated with cash, including “street cash” – see below for more information. 

You should consider your own health and safety before you take the steps in this guide. If you feel threatened or unsafe, you should consider changingyour line of questioning. If you feel your health and safety is at risk, consider terminating the visit. You should make a full note in your notebook and speak to your line manager. [Link to ECSH 32929 Officers personal safety] [Link to ECSH 34245 Reporting abusive or aggressive customers]. 

During the intervention 

Discuss where and how much cash is usually held on the premises, including how much is needed for petty cash and float (the amount of cash on hand at the start of the day).Ask what records are maintained, for example is there a separate cash book,when the cash is reconciled with the records, how this is done and by whom. 

Ask details regarding banking, for example, is it banked daily or when the cash reaches a specific limit, say £20,000,when it was last banked and by whom. This may be in line with the business’s insurance policy. You will need to ascertain from the business what they are insured for, for example, storage and/or transportation. 

If a safe (or other secure storage area) is used, record details of who has access to the key or code. 

Businesses that accept large volumes of cash might have a contract with a courier or Cash and Valuables in Transit (CVIT) company to collect the cash. The volume of collections will vary from business to business, and you shouldask to see a copy of the contract and any receipts issued, during the period you are testing. This will confirm the name of the CVIT, number of scheduled collections and amounts involved. Where a CVIT is being used, you will need to check whether they are SIA registered. For more information on this see Apply for an SIA licence  

If you establish that a cash collection is scheduled during your visit, or the courier/CVIT company arrives to collect the cash, please ask the business to ask the CVIT to return at another time to allow you to perform an accurate cash count (see below). If this isn’t possible, you shouldobserve and record as much detail as possible regarding the cash being collected. 

Ask the business the total amount of cash there should be on site, where it is, and in what denominations (i.e. £20s, £50s), includingwhere the cash is in other currencies. Where the business premises are shared with another third party on site, they may share their storage. 

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)

Performing the cash inspection 

As part of your transaction testing,ask the business to open the safe (secure drawer or other storage area) and show you how much money is currently held on the premises.This should match the volume of cash previously recorded. 

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)