Anti-Money Laundering Checks: What You Need to Know

The statistics on money laundering

Money laundering poses a significant challenge to the UK, with the National Crime Agency (NCA) warning that it remains a major threat to national security. Shockingly, billions of pounds in suspected dirty money pass through the UK’s financial systems each year, making it a prime destination for money laundering.

The UNODC estimates the amount of money laundered in one year is 2 – 5% of global GDP, but of course the true figure will never be known. Fraudsters will continue to learn and adapt, with newly emerging and more complex money laundering techniques being utilised year on year. To successfully combat money laundering, it is crucial that comprehensive and globally harmonised regulations be adopted and enforced. 

What is an AML or KYC check?

An AML check is a process that screens customers to essentially ensure they are who they say they are, and that their reason for obtaining the product/service is valid. This is all in an attempt to mitigate the possibility for any facilitation of money laundering and other financial crime, and to maintain the reputation of the providers client base.  

The process involves verifying the identity of the individual using the service. You’ll need to provide your photo ID and proof of address documents in order for the provider to do so. In order to corroborate the information it is likely various databases will be searched and electronic checks run, including a soft-search on your credit report. Where the customer is a business, documents will be required for the Ultimate Beneficial Owners (UBOs) of the business – and checks to verify this and your business will be run. You may also be asked certain questions in order for the service provider to understand your circumstances better, and in some scenarios (for example a Politically Exposed Person) Enhanced Due Diligence checks may be necessary.

It’s worth noting that we obtain and securely hold this information solely for the purpose of complying with the regulations, and not to share with any nasty third parties.

You can find out more about our on-boarding process specifically, and what’s required here.

Why we’re a trusted and respected provider

When using virtual office space you are sharing a business address with many other businesses. If a business sharing your virtual address becomes implicated in unlawful practices, be it complaints of scam activity, unfair practices or at the very worst investment fraud, money laundering or even terrorist financing, it could potentially tarnish your own business reputation by association. This is due to the simple fact that perception matters in business, and if customers or partners perceive your business to be in the same sphere as a disreputable company, it could cause irreversible damage.

But at Virtual HQ, we are strict on our checks. We would never bypass the requirements for the sake of profit, and we have a low-risk appetite – meaning we don’t just turn away clients linked to confirmed criminal activity, but those with adverse media or complaints too. Our compliance team is dedicated and committed and are trained to spot anything suspicious. We continuously review and improve our onboarding process, ensuring that our process is as straightforward as possible without cutting corners. You can be safe in the knowledge that we have done our very best to ensure you are only sharing your address with the very best.

So – you might have found a provider offering virtual office services for a fraction of the price? Or a provider willing to sign you up and activate your services without obtaining your documentation? Sure, you know that your business is legitimate – but just think about who else could be sharing your address? Entrusting your business to a provider who doesn’t conduct thorough AML checks can be a high-risk gamble, with your business’ reputation paying the price. 

You also most likely require an office address that is just that, a real, physical office, with manned receptions and not just a PO Box. If opting for a provider registering thousands of businesses at one address, the quality of the address will reduce. You don’t want too many cooks in the kitchen – the risk of associational reputation damage only increases! And who knows what will happen to your mail? 

We won’t register in the thousands, and mostly, we won’t even register in the hundreds. We understand the importance of a local, genuine address that will maintain that presence, and not an address that sticks out as virtual.