Money laundering reporting officer
MLROAlso called nominated officer, SMF17
A money laundering reporting officer (MLRO) is the senior individual at a regulated firm responsible for its anti-money laundering systems. The MLRO decides whether suspicions raised internally are reported to the authorities. In the UK the MLRO usually acts as the nominated officer under the Money Laundering Regulations.
How it works
Staff send internal suspicious activity reports to the MLRO. The MLRO reviews each one, gathers further information and decides whether to file a suspicious activity report with the National Crime Agency, including requests for a defence against money laundering. The MLRO also oversees AML policies, training and the firm's risk assessment, and reports to the board, usually through an annual MLRO report.
The role carries personal exposure. A nominated officer who fails to disclose a known or suspected case can commit a criminal offence under the Proceeds of Crime Act. Under the Senior Managers and Certification Regime the MLRO holds the SMF17 function, so the FCA can hold the individual accountable. Regulators expect the MLRO to have authority, resources and independence.
The rules
Requires firms to appoint a nominated officer and, where appropriate to their size and nature, a board member or senior manager responsible for AML compliance.
UK relevant persons in the regulated sectorMakes it an offence for a nominated officer to fail to disclose knowledge or suspicion of money laundering received through an internal report.
Nominated officers in the regulated sectorFrom 10 July 2027, requires obliged entities to appoint a management-level compliance manager and a compliance officer responsible for AML policies and reporting suspicions.
EU obliged entitiesCommon questions
Is the MLRO the same as the nominated officer?
In most UK firms the same person holds both roles. The Money Laundering Regulations require a nominated officer to receive internal reports and make disclosures, while FCA rules require many firms to appoint an MLRO with oversight of AML systems. Larger firms often appoint deputies.
What is the SMF17 function?
SMF17 is the money laundering reporting officer function under the Senior Managers and Certification Regime. The holder needs FCA approval before taking up the role and has a statement of responsibilities that the FCA can rely on in enforcement.
Can the MLRO role be outsourced?
Firms can buy external support for AML work. Regulators expect the MLRO to be an individual with enough seniority, authority and knowledge of the business to do the job. Responsibility for compliance stays with the firm and its senior management.
