ECSH33111 - Nominated Officer

The role of the nominated officer 

Businesses must appoint a nominated officer under Regulation 21(3) of the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017(MLR 2017). You should check that the nominated officer is aware of their role and responsibilities. You should also confirm that they are an employee of the business with sufficient seniority to carry out this role effectively and independently. 

Remember, a supervised sole proprietor with no employees must act as the nominated officer. 

The nominated officer’s role is to be aware of any suspicious activity in the business that might be linked to money laundering, terrorist financing and/or proliferation financing (ML/TF/PF), and if necessary to report it. 

They’re responsible for: 

  • receiving reports of suspicious activity from any employee in the business 
  • considering all reports and evaluating whether there is (or seems to be) any evidence of ML/TF/PF 
  • reporting any suspicious activity or suspicious transaction to the National Crime Agency (NCA) by completing and submitting a Suspicious Activity Report (SAR) 
  • asking the NCA for a defence to a money laundering offence in relation to the transactions that they’ve reported, and making sure that no transactions are continued illegally 

More information can be seen in the external guidance published on GOV.UK: Appoint a nominated officer and train staff for money laundering supervision  

Sometimes the nominated officer may have additional responsibilities such as overseeing a business’s compliance with the MLR 2017. [Link to ECSH 33112 Compliance officer] However, this is not always the case. 

Money laundering reporting officer (MLRO) 

Appointing a money laundering reporting officer (MLRO) is not a requirement of the MLR 2017. Businesses regulated by the Financial Conduct Authority (FCA) are required to appoint an MLRO with responsibility for oversight of a business’s compliance with the FCA's rules. 

Businesses that HMRC supervise may sometimes appoint an MLRO. This could be because they are also supervised by the FCA for dual supervision alongside HMRC due to the type of businessactivities and therefore it is a requirement to appoint an MLRO. For example, some money service businesses (MSBs) and trust or company service providers(TCSPs) may be supervised by both and therefore you may see references to MLROs more in these sectors. Alternatively, businesses may use the term MLRO as a job title.  

If a business has an MLRO, you should establish what the role of the MLRO involves: 

  • is the MLRO also the nominated officer in that they are responsible for receiving internal reports of suspicion and reporting externally? 
  • is the MLRO responsible for the business’s compliance with the MLR 2017? See ECSH 33112 Compliance officer 
  • are there any other responsibilities that the MLRO holds? 

You should note that the same person could be responsible for both receiving internal reports of suspicion and the business’s compliance with the MLR 2017. Alternatively, the responsibilities may be held by different individuals depending on the size and nature of the business. You should take this into consideration and ensure that you are conducting your intervention with the right persons.