Trust or Company Service Providers – who they are
This section is for IFA/FTA members who provide company services, ranging from interim management, non executive directors to company secretaries.
The definition of a Trust and Company Service Provider (TCSP), given in the Money Laundering Regulations 2007 (MLR 2007), explains how you must be supervised for anti money laundering purposes.
However, an important limiting decision was taken in 2008 to include only those firms directly invoicing the end client; firms (or sole traders) who work through agencies, and do not invoice the end client themselves (but invoice the agency) are not required to register for AML supervision as TCSPs.
Similar requirements are scheduled to cover TCSPs in the Republic of Ireland and will eventually cover those working in all other EU member states.
MLR 2007 article 3(10) defines a TCSP:
'Trust or company service provider' means a firm or sole practitioner who by way of business provides any of the following services to other persons:
(a) forming companies or other legal persons;
(b) acting, or arranging for another person to act'
(i) as a director or secretary of a company;
(ii) as a partner of a partnership; or
(iii) in a similar position in relation to other legal persons;
(c) providing a registered office, business address, correspondence or administrative address or other related services for a company, partnership or any other legal person or arrangement;
(d) acting, or arranging for another person to act, as'
(i) a trustee of an express trust or similar legal arrangement; or
(ii) a nominee shareholder for a person other than a company whose securities are listed on a regulated market, when providing such services.
However, non executive directors and company secretaries of all companies (both financial and non-financial) and those who arrange the appointment of such people should note that they are included as designated persons too.
TCSPs must comply with MLR 2007. This includes cases where the company of which they are a director or secretary is caught separately by the AML law; e.g. as a non-executive director of a credit/financial institution, money service business or collective investment scheme (it may be inappropriate in such cases for the IFA to act as your Supervisor – the OFT or HMRC may be more appropriate).
Recruitment agents and search and selection agents should also determine if they may be caught as “arrangers of persons to act as directors and company secretaries”.
The Institute of Interim Management is not a designated supervisory authority under the regulations. There is no requirement for IFA/FTA members who are TCSPs to register with HMRC either instead or as well. However, all concerned should know the major requirements under MLR 2007 which they must observe, including customer due diligence (CDD), training and the keeping of records.
Matters such as the reporting of suspicious transactions (SARs) to the Serious Organised Crime Agency (SOCA), are covered under the provisions of the Proceeds of Crime Act 2002 as amended by the Serious Organised Crime and Police Act 2005 and other UK legislation referring to money laundering and terrorism.
