BMA to seek clarity for GP exemption from anti-money-laundering initiative

GP practices and PCNs may have to register under an anti-money laundering scheme despite a BMA warning this may have ‘unintended consequences’.

New rules were introduced in the UK in 2020, but despite more recent guidance from HMRC, it remains unclear whether the scheme applies to GP surgeries, LMCs have warned.

Under the Trust Registration Service (TRS) rules – implemented as part of an EU anti-money-laundering directive – certain GP models ‘may be required to register’ as ‘Trusts’ by 1 September, Kent LMC told practices.

In a newsletter sent to practices this week, Kent LMC said that it ‘has been indicated’ that GP surgeries, PCN bank accounts and ‘shares held in a GP provider-type company’ may have to register by the deadline next week.

However, it added that HMRC is ‘still clarifying’ some of its guidance and has ‘not yet stated if it is intended that GP surgeries will have to comply’.

‘The GPC is aware of the potential unintended consequences of this legislation and it is expected that representation be made that GPs, as public bodies, should be exempted,’ the LMC said.

The newsletter continued: ‘Whilst practices may wish to take advice from their accountants, the LMC believes it is not necessary for practices to take any action regarding the formation of Trusts at this point until further guidance is issued.’

But Cleveland LMC warned that GPs unsure about whether they need to register with the TRS should seek legal advice.

A bulletin from Cleveland LMC, also shared with practices this week, explained that the Fifth Money Laundering Directive was introduced in 2020 into UK law to ‘broaden the scope’ of those that needed to sign up to the TRS.

This may include some GP surgeries ‘depending on how they are structured’, such as property-owning GP partners, particularly where the names on the land registry entry do not match the names of the partners or where there are more than five owners, it said.

Also, depending on the ‘precise wording’ of a PCN agreement, monies held by one practice on behalf of a PCN ‘could be construed as the formation of a trust and may trigger a registration requirement’, the bulletin added.

The LMC pointed to guidance published by the HMRC on what constitutes an express trust and where exemptions may apply.

But it said: ‘If you are unsure whether you need to register with the TRS, it is important that you receive independent legal advice, as a failure to register may result in financial and criminal penalties.’

It was estimated in 2019 that the NHS could be losing around £1.29bn every year due to economic crime, with general practice responsible for £88m of this.

But GP leaders accused NHS England of tarnishing their reputation and demanded an immediate apology for the ‘destructive narrative’ in its fraud report.