Find out more about what businesses that rent safety deposit boxes need to do.
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The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 require businesses that offer safe custody services to take steps to detect and prevent money laundering and the finance of terrorism. We have responsibility for regulating this.
A safe custody service offers safety deposit boxes or other secure storage suitable for high-value physical items like jewellery, precious metals or documents of title.
Businesses that offer safe custody services must:
- register with the FCA
- take steps to detect and prevent money laundering and the finance of terrorism
Businesses that don't need to register
We would not consider a business only offering the following services to be a safe custody service:
- storage of goods such as luggage, household items or motor vehicles
- storage of non-physical property like computer data
- secure transportation of high-value items
- offering safe custody on an occasional or very limited basis, such as hotels providing a safe for guests. To be excluded, your business needs to meet all of the criteria in Regulation 15(3) of the Money Laundering Regulations 2017
- legal professionals storing legal documents
What businesses offering safe custody services need to do
Failure to register with us is an offence that potentially carries either a civil or criminal sanction. There are also both civil and criminal penalties for failing to comply with the requirements of the regulations.
Firms that are already authorised and regulated by us do not need to register again.
The Money Laundering Regulations 2007 require that safe deposit box providers take a number of steps to prevent money laundering. Businesses must, for example:
- apply customer due diligence measures: verifying the identity of customers, and getting information about the nature and intended nature of the business relationship
- monitor business relationships to identify suspicious activity and ensure that information about customers is up-to-date
- apply more stringent measures in situations where there is a higher risk of money laundering
- report suspicious activity to the authorities
- maintain appropriate procedures designed to achieve the above, including procedures related to record-keeping and staff training
Complying with sanctions law
HM Treasury's list of financial sanctions targets contains details of known terrorists and other persons who have had their funds frozen after sanctions have been applied by the UN, EU or UK government.
It is an offence for anyone to make funds available to a person or entity that is the target of sanctions. Safe custody services would be well advised to have procedures in place to check whether new and existing customers are subject to sanctions.
Reporting suspicious activity
The systems and controls that safe custody services are required to put in place are there to enable you to report knowledge or suspicions about money laundering or terrorism to the authorities.
Suspicious Activity Reports (SARs) should be filed with the National Crime Agency (NCA). For advice on completing SARs, please refer to the list of frequently asked questions on the NCA website.