Tribunal case – Money Laundering Regulations
A small business owner has had his appeal rejected as regards the penalties imposed on him for non-compliance with the Money Laundering Regulations.
The taxpayer operated a small foreign exchange business based in Northern Ireland where he cashed third party cheques and bought and sold Euros in exchange for Sterling.
HMRC had imposed a penalty in respect of errors in meeting the verification and record-keeping requirements of the Money Laundering Regulations. The taxpayer accepted that he had made a number of errors and the Tribunal Judge accepted that the taxpayer did not appear to be involved in knowingly circumventing the underlying purpose of the Money Laundering Regulations. Nevertheless, poor compliance could make it easier for money laundering to take place.
The Tribunal found that the taxpayer had received more than reasonable warnings from HMRC and had also paid earlier penalties that had been imposed. The taxpayer’s appeal was therefore dismissed. The Judgement acts as an interesting reminder to all taxpayers of the importance of proper record keeping.