The following two reports provide strong hints as to which risks the UK anti-money laundering (AML) effort is likely to be tackling in 2026.

In July 2025, sanctions evasion emerged as a major cause for concern in the Home Office and HM Treasury’s National Risk Assessment of Money Laundering and Terrorist Financing 2025 – the first report of its kind for five years. 

In particular, the report cited grim figures from the Office for Financial Sanctions Implementation (OFSI) – the UK Government body responsible for enforcing sanctions. According to OFSI, suspected breaches of sanctions surged from 147 in 2021/22 to 396 in 2023/24.

“Assets frozen under UK sanctions that are used, transferred or moved without a licence become proceeds of crime and their use can constitute money laundering,” the report noted, stressing that bad-faith professionals in law and finance are enabling evasion.

In September, the latest risk outlook from the Accountancy AML Supervisory Group (AASG) highlighted growing links between sanctions evasion, money laundering and kleptocracies. Amid geopolitical shifts, it warned: “Individuals and entities under sanctions are making greater use of established laundering networks – including international controllers, professionals and complex organisational structures – to conceal the sources of their funds.”

Politically exposed persons are hiding assets

ICAEW’s Head of AML and Operations Michelle Giddings has explored the reports in detail. In her assessment, efforts to circumvent sanctions have intensified in the wake of regulatory actions against politically exposed persons (PEPs), arising from major geopolitical events such as the war in Ukraine. For some PEPs and other wealthy sanctioned individuals, the goal is to maintain ownership of key assets – or conceal them from authorities altogether.

“That may involve giving houses to distant relations, for example, or placing high-value assets into a corporate structure,” she says. “Anything to ensure that the beneficial ownership or controlling share is so oblique that officials can’t work out what’s happening.”

Some of the related money laundering could be coming through London, she notes.

Tech is making money laundering easier

For Giddings, another powerful point that emerges from the reports is the extent to which technological advancements are smoothing the way for money laundering. “There are two pillars here,” she says. “The first is crypto – a bit of a double-edged sword. On one hand, the paper trail of a distributed ledger is clear. Each transaction is recorded on the blockchain, which is easy to follow. But the downside is that assets can be transferred from, say, the UK to the US to Australia very quickly. That enables criminals to move money faster than ever. The caveat is that only a miniscule percentage of the total value of crypto assets is illicit.”

The second pillar is artificial intelligence (AI). It’s now possible to ask AI platforms how to launder money. Those platforms will also give quite detailed instructions on how to do it.

“To ensure the prompts aren’t too obvious, they may ask their AI to produce a film script, storyboard or staff training materials explaining how it’s done,” Giddings says. “Those outputs could then be widely distributed. In another area of criminality, we’ve already seen cases of how-to manuals for romance fraud being sold on the dark web.”

The impact of complex corporate structures

Turning to more perennial risks, Giddings points out that complex corporate structures continue to feature in almost every kind of money laundering – providing an easy means to hide illicit assets, quickly transfer them from one entity to another or conceal the identity and location of beneficial owners.

While regulatory shifts such as Companies House reforms have made corporate data more transparent, Giddings says, “we’re still some way off from creating enough friction to prevent complex structures from being a factor in money laundering.”

Professionals are still a target

In parallel, as the two reports note, money launderers are continuing to enlist the conscious or unwitting support of professionals. In terms of how that may work, a bad-faith client may approach an accountant with information containing data on illicit transactions and ask for that material to be converted into financial statements, the aim being to disguise the criminality. The accountant could be either willingly or inadvertently complicit.

“This is where an AML framework becomes so important,” Giddings says. “If you have strong controls within your organisation and your employees understand them, you’re much less likely to be drawn into that enabling behaviour.”

Customer due diligence is critical

Giddings is confident that the UK’s current AML regulations are fit for purpose within the profession, as they provide an effective, risk-based approach broad enough for accountants to apply to various different contexts. 

“For the most part, they encourage you to consider how a criminal may use you, and which sorts of controls you should put in place to identify when that may happen. There’s quite a big focus on customer due diligence (CDD), which ICAEW has highlighted as a critical task for tackling criminal enablement.”

In September, HM Treasury published a set of draft amendments to the AML regulations. However, Giddings points out, they do not mark a sweeping overhaul, but an effort to clarify the regulations’ language to ensure their clauses are proportionate.

Asked what accountants can do to stay alert to signs of wrongdoing, Giddings recommends that firm-based accountants read both reports. She says, “It’s slightly tricky for firms, in that the vast majority of accountants may never see any evidence of money laundering, on the level of organised crime, in their day-to-day work. So, it’s really a case of remaining vigilant and up to date to keep on top of what the risks look like.” 

It’s why ICAEW’s CDD guidance focuses on the mechanics of client risk: how to identify, risk assess and verify the people who are seeking your services.