Economic Crime Levy: Year one recap
HM Treasury (“HMT”) recently published its Economic Crime Levy (ECL) Report 2023–24 (the Report) which provides a summary of the first year of the government initiative to fund the national fight against economic crime through a statutory levy on firms subject to the Money Laundering Regulations (MLRs). Mandated by the Finance Act 2022 and collected from April 2023, the levy raised approximately £90 million in its initial year, contributing to a broader £300 million investment between 2023–24 and 2025–26.
The funds are earmarked to focus on the following 6 key deliverables:
1. £100 million for cutting-edge AML technology
HMT plans to invest a large proportion of the ECL into empowering law enforcement with real-time threat analytics and datasharing platforms, enabling quicker, more proactive responses to emerging financial crime patterns. So far, this has focussed on programmes supporting SARs processing, asset recovery and cross-system data exploitation.
2. Increasing resourcing across the AML system
An ambitious recruitment and training drive by HMT plans to increase resourcing across various areas to tackle money laundering and asset recovery—almost 200 new members of FTE staff have been onboarded across the National Crime Agency, City of London Police and other allied agencies fighting financial crime. This is expected to significantly support criminal investigations, prosecutions, and asset recoveries.
3. £60 million for specialist intelligence
This investment will see new teams at the NCA as well as expansion of the Combatting Kleptocracy Cell to tackle the most complex global money laundering networks. This investment has so far led to a 6% increase in the NCA’s highest impact AML disruptions, denying more than £230m of criminal assets.
4. Improving SAR analysis - Over 75 new officers + 22 regional financial investigators hired
Funding for 75 new agents and 22 regional financial investigators dedicated to SARs aims to improve detection and prosecution of serious organised crime. The aim is for there to be an increase in the volume of intelligence referrals and enabling better advice and training for reporters, ultimately leading to better quality SARs.
5. £20 million for companies house & insolvency intel teams
Arguably one of the most anticipated improvements sees a key focus being put on improving the ability of Companies House and the Insolvency Service to support wide reforms. This will help tackle misuse of UK companies and allow a better detection of money laundering taking place through corporate entities.
6. A dedicated AML supervisory surge team
A dedicated surge team has been setup to accelerate key reforms in AML and CTF supervision. So far detailed policy work has been undertaken with a public consultation around enhancing risk-based checks, stronger enforcement, and improved intelligence sharing.
Next steps for the ECL
Annual reporting: A continuation of reporting through to the end of the proposed time period focussing on how the levy is being spent and the outcomes.
Comprehensive review: A full-scale review is scheduled by end-2027, assessing overall levy efficacy and guiding future reforms.
Continued public–private coordination, aligning investments with the three-year Economic Crime Plan.
Key takeaway for financial services firms
The ECL signifies a major escalation in the UK’s attempt to improve its financial crime defences. With substantial investments across tech, personnel, and intelligence capabilities, it signals that regulated firms must invest in prominent AML readiness, robust reporting, and compliance infrastructure.
If you need our help to enhance or assure your AML framework get in touch at contact@avyse.co.uk