HMT responds to its FCA duties, powers and accountability consultation

HM Treasury has set out its plans for the new regime; here are the key announcements.

The Treasury has issued a 59-page response to its anti-money laundering/counter-terrorist financing (AML/CTF) supervision reform consultation. This is our overview of the key points accountants must be aware of, and the context around it. AAT continues to support our members through the transition.

Context

On 21 October 2025, the Government confirmed that the AML/CTF supervision for accountancy, legal and Trust and Company Service Provider sectors will move to a single professional services supervisor (SPSS), the Financial Conduct Authority (FCA).

Once the transition is concluded, the Office for Professional Body Anti-Money Laundering Supervision (OPBAS) will be closed. We still don’t know the timeframes for this change, as the implementation for this new regime is dependent on legislation, funding arrangements, and the FCA’s delivery plan.

While this is a big shift, implementation is likely to take years. In the meantime, AAT will continue as the AML supervisor for eligible AAT licensed members and carry out our normal responsibilities, including Practice Assurance Reviews and risk assessment activities.

Consultation response

On 19 November 2025, HMT opened a consultation on proposals to reform AML supervision, which we responded to on 19 December 2025. On 18 June 2026, HMT responded to its consultation (PDF), setting out its plans for the new regime.

Key details

There are no huge surprises in the consultation response. Here are the main points accountants should be aware of:

• The FCA will lead a new registration system, including a single public register of firms.
• There will be more consistent entry requirements, with ‘fit and proper’ checks extended across accountancy.
• The FCA will take a risk-based approach to supervision, applying a consistent framework across sectors, and the potential use of tools such as skilled person reviews.
• Existing powers within the money laundering regulations – information gathering, inspection and information sharing – will be extended to the FCA’s supervision of professional services firms.
• The FCA will be responsible for issuing a new framework for guidance, with continued input from the industry (and limited oversight from HMT) to keep it practical.
• The intention is for better information sharing and coordination between regulators, helping reduce duplication and creating a more joined up system.
• The government will place an ongoing requirement on the FCA and existing professional body supervisors to establish information sharing and cooperation arrangements.
• The approach will be proportionate enforcement, using existing powers with potential for simpler processes for lower level breaches, while keeping independent routes of appeal.
• During the transition period, OPBAS will continue to oversee the performance of professional body supervisors.
• Supervision will be funded through FCA fees, with a further consultation coming.

Upcoming legislation

The Financial Services and Markets Bill features AML supervision, and has been published and introduced to Parliament. The Bill introduces powers to facilitate AML supervisory cooperation and information sharing, primarily by enabling ministers to make regulations requiring disclosures and coordination. It relies on broad delegated powers, including the ability to amend legislation and update frameworks via secondary legislation, which will allow the rules to evolve over time rather than fixing them in primary legislation.  

The majority of the necessary legislative changes will be made via secondary legislation. The measures in the Bill will ensure that the government has the necessary powers to make these changes, and to provide the FCA with the start-up funding it will need for the implementation period.

AAT’s reaction

The direction of travel is positive. The government’s response is broadly aligned with what we called for, setting out a more consistent, risk-based and proportionate approach. We’re pleased to see clear focus on better coordination and a well-managed transition, though more detail is still needed on how the transition will work in practice.

Rebecca Roberts-Hughes, Executive Director of Strategy and Compliance at AAT said:

We welcome HM Treasury’s response to its consultation on the reform of the UK’s anti-money laundering supervisory regime. It’s essential that the government’s new regime is proportionate, risk-based and workable for firms of all sizes, particularly smaller practices – and it’s positive to see the Treasury recognise this.

The focus must now be on a well-managed transition. AAT remains actively engaged with both government and the FCA to bring our supervisory experience into that process. Now is the time to work together on the detail to make sure the new system succeeds.

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