The Proceeds of Crime (Money Laundering) (Threshold Amount) (Amendment) Order 2025

It may be useful to run through some background to give this change some context;

The principal offences under the Proceeds of Crime Act are sections 327-329 

The principal money offences under the Terrorism Act 2000 are under sections 15-18

One of the main functions of the UKFUI are receiving and the processing of requests for defences against money laundering and terrorist financing. 

You will note that as of 31 July 2025 the threshold for making a DAML SARS has changed from £1000 to £3000.  This was not the first time that the threshold had been increased, in 5 January 2023, they were increased from £250 to £1000. 

This threshold exemption relates to DAML SARs and Not Information SARs. If you have a suspicion you are required to submit an Information SARs.

Please see the order for its application

Proceeds of Crime Act section 339A(2) and (6A) of the Proceeds of Crime Act 2002 (c. 29) (“POCA”)

The Guidance  - Guidance on the exemptions from the money laundering obligations and money laundering reporting obligation in the Proceeds of Crime Act 2005, was update on 31/07/25

The purpose of this change was set out in the Debate about the draft changes, on Tuesday 17th June 2025,  - see the document here

Dan  Jarvis, the Minister for security, stated:

"...Driving down money laundering is critical to the Government’s key missions to deliver safer streets and economic growth, and I am determined that the Government will do all they can to bring justice to those seeking to wash their illicit funds through the UK. Close working with the private sector is integral to delivering on that objective. As our first line of defence, the private sector plays a fundamental role both in preventing the UK financial system from being exploited for criminal gain and in detecting suspicious activity where it has occurred.

I am proud that the UK was one of the first countries to establish a financial crime public-private partnership and has set the international standard in this area. Part of a successful public-private partnership is honestly reviewing what has worked in tackling money laundering and what needs to change for us to be more effective. With that objective in mind, and as part of “Economic Crime Plan 2”, the Government, law enforcement and the private sector have worked together to consider how public-private resource can be better directed to maximise our collective impact against the threat.

The draft order is one of the first outputs of that work. It raises the existing financial threshold for two exemptions that apply to principal money laundering offences under the Proceeds of Crime Act 2002 from £1,000 to £3,000. The uplift in the threshold will enable law enforcement resource to be focused on higher priority reports that provide greater opportunities for asset denial and disruption of criminal activity. It will also free up businesses’ resource to be redirected towards high-value activity that may have a greater impact on the threat. The measure is further expected to reduce the impact on banking customers by reducing instances of legitimate customers being unable to access their accounts, in particular where no further action is taken.

The first exemption applies to acts in operation of an account, such as paying expenses, by deposit-taking bodies, which are essentially banks and building societies, and electronic money and payment institutions. The second exemption applies in the instance of a business in the anti-money laundering regulated sector ending a relationship with a customer and paying away any money or property to the customer. This means that for transactions below the threshold, businesses in the anti-money laundering regulatory sector do not need to submit defence against money laundering suspicious activity reports, known as DAML SARs.

A DAML SAR is submitted to the National Crime Agency by a person proposing to deal with suspected criminal property, which may make them liable for one of the principal money laundering offences under the Proceeds of Crime Act. By submitting a DAML, a person can avoid committing one of the principal money laundering offences by obtaining consent, or deemed consent, for the act they propose to carry out—for example, a customer’s transaction to pay their mortgage. The DAML provides information to the UK Financial Intelligence Unit housed in the National Crime Agency and prevents the business from carrying out the activity referenced in the request until the UKFIU gives a consent decision or seven working days pass, after which the business can assume that it has consent.

In 2023, the threshold was raised to £1,000 due to the rising volume of DAMLs and the regulatory burdens on businesses to submit a DAML SAR, as well as burdens on law enforcement to review and the delay to customers, who must often wait seven days for their transaction to be processed. While the £1,000 threshold has likely contributed to a reduction in DAMLs, evidence shows that the UKFIU continues to receive a large number of low-value DAMLs, only a small proportion of which lead to asset denial opportunities.

Between January and December 2024, approximately 23,000 DAMLs relating to transactions between £1,000 and £3,000 were submitted. Of those, only 182 were refused, equating to 0.1% of all assets denied because of DAMLs in that year. To prevent the loss of information, businesses must still submit an information-only suspicious activity report to the UKFIU where they suspect any and all involvement in money laundering. That duty will not be affected by the draft order.

Having, I hope, covered the key points, I commend the draft order to the Committee..."

Following on from the debate is it clear that you must:

• Update your Firm Wide Risk Assessment and Policies, Controls and Procedures
• Train staff with regard to the changes
• Undertake Client Due Diligence and Enhanced Due Diligence 
• Escalate where appropriate
• Where you have a suspicion submit a Information SARs
• Keep records
• Remember you can contact UKFIU with queries

Hansards - House of Commons Debate on the Draft order

UKFIU  - United Kingdom Financial Information Unit

Proceeds of Crime Act 2002 

Order -  The Proceeds of Crime (Money Laundering ) (Threshold Amount) (Amendment) Order 2025

This post is not legal or regulatory advice, nor is it intended to construed as such.

If you require advice, seek the same from independent qualified provider in relation to your individual circumstances.