JMLSG Part I revisions. What the September 2026 changes mean for compliance teams?

The UK anti-money laundering landscape continues to evolve, and firms should take note of the latest updates from the Joint Money Laundering Steering Group (JMLSG). On 1 September 2026, the JMLSG published a series of revisions to Part I of its Anti-Money Laundering and Counter-Terrorist Financing Guidance, reflecting changes introduced through the Money Laundering and Terrorist Financing (Amendment) Regulations 2026. These amendments have been submitted to HM Treasury for Ministerial approval and are expected to influence how regulated firms manage customer due diligence (CDD), authority verification, pooled client accounts and risk assessments.

While many of the updates are highly technical, their impact is practical. Compliance teams, money laundering reporting officers (MLROs), onboarding specialists and risk professionals should assess how these revisions affect existing policies, procedures and technology controls.

Why the JMLSG guidance matters

JMLSG guidance plays a critical role in helping regulated firms demonstrate compliance with the UK Money Laundering Regulations. Although not legislation itself, it is approved by HM Treasury and is widely regarded as the benchmark for AML compliance across financial services and other regulated sectors. Firms that follow JMLSG guidance are generally better positioned to demonstrate that they are meeting their regulatory obligations through a risk-based approach.

The September 2026 revisions focus on several key areas that have become increasingly important as financial crime risks evolve and customer onboarding processes become more digital.

1. Clarifying what constitutes an “Unusually” complex transaction

One of the revisions updates paragraph 2.9, providing further clarity around the requirement for firms to identify and scrutinise transactions that are “unusually” large or complex.

The amended guidance explains that “unusually” should be interpreted in the context of a firm’s knowledge of the customer, their business activities and their expected risk profile. In other words, what is unusual for one customer may be entirely normal for another.

What this means in practice

Compliance teams should ensure that transaction monitoring frameworks move beyond fixed thresholds and incorporate customer-specific context. Effective monitoring increasingly depends on understanding expected behaviour and identifying deviations that warrant investigation.

This reinforces the importance of accurate customer profiles, ongoing due diligence and dynamic risk assessments rather than relying solely on static rules.

2. New guidance for customers of insolvent banks

A further amendment addresses situations involving customers of insolvent banks. New provisions reflected in paragraph 5.2.4A recognise that customers affected by a bank insolvency may require urgent access to banking services.

The revised guidance allows credit institutions, under specific conditions, to open accounts and permit transactions before the completion of all customer due diligence checks, provided customer identification has taken place and remaining CDD requirements are completed as soon as possible.

Balancing accessibility and risk

The update demonstrates the regulator’s willingness to support vulnerable customers during exceptional circumstances. However, it does not remove the obligation to complete full due diligence.

Firms must therefore ensure they have processes capable of:

• Identifying customers eligible under the insolvency provisions
• Recording decisions appropriately
• Completing outstanding verification activities promptly
• Managing any heightened financial crime risks during the interim period

Technology-supported onboarding processes can help compliance teams meet these requirements without introducing unnecessary delays.

3. Stronger focus on authority verification

Perhaps one of the most significant practical changes relates to paragraphs 5.3.94A and 5.3.99, which provide additional clarification around individuals acting on behalf of customers.

The revised guidance explains how firms should verify the identity and authority of persons purporting to act on behalf of another individual or organisation. It also clarifies that individuals operating under powers of attorney should be treated as acting on behalf of the customer.

A growing area of risk

Impersonation fraud and misuse of authority continue to present challenges for regulated organisations. Criminals increasingly exploit weaknesses in onboarding and verification processes by posing as authorised representatives or using falsified documentation.

As a result, firms need controls that verify both:

1. The identity of the individual presenting themselves.
2. Their legal authority to act on behalf of the customer.

This is particularly relevant for:

• Corporate onboarding
• Beneficial ownership verification
• Power of attorney arrangements
• Trust and estate administration
• Professional intermediaries acting for clients

Robust identity verification, combined with authority verification checks, can significantly reduce the risk of fraud and regulatory breaches.

4. Updated guidance on pooled client accounts

Paragraph 5.3.142 and Annex 5-V have also been revised to provide additional guidance relating to pooled client accounts (PCAs). The updates clarify when simplified due diligence (SDD) may be appropriate and offer further guidance on how firms should assess the risks associated with these account structures.

Pooled client accounts are commonly used by legal, professional and financial service firms where funds are held on behalf of multiple underlying clients.

While these arrangements are legitimate, they can present transparency challenges if firms lack visibility of the underlying parties or source of funds.

Key considerations for firms

Compliance teams should review:

• Risk assessment methodologies for pooled accounts
• Customer identification procedures
• Beneficial ownership controls
• Ongoing monitoring arrangements
• Documentation supporting simplified due diligence decisions

The updated guidance emphasises that SDD should never be applied automatically and must always be supported by an appropriate assessment of risk.

Preparing for the changes

Although the September 2026 revisions are currently awaiting final HM Treasury approval, firms should begin reviewing their AML programmes now.

Key actions include:

• Reviewing transaction monitoring policies
• Updating onboarding procedures
• Assessing authority verification processes
• Re-evaluating pooled client account risk frameworks
• Providing refresher training to compliance staff
• Ensuring technology systems support regulatory requirements

For many organisations, these revisions highlight an ongoing challenge: balancing compliance obligations with efficient customer experiences.

How our technology can help

Modern AML compliance increasingly depends on the ability to verify identities, verify authority, assess risk and maintain comprehensive audit trails while keeping onboarding friction to a minimum.

Electronic identity verification solutions can help organisations:

• Validate customer identities quickly and accurately
• Support risk-based customer due diligence
• Verify corporate structures and beneficial ownership
• Reduce impersonation risks
• Create robust evidence for regulatory reviews
• Improve operational efficiency

As regulatory expectations continue to develop, firms that combine strong governance with effective verification technology will be better positioned to adapt to future changes while maintaining customer trust.

The September 2026 JMLSG Part I revisions may appear technical on the surface, but they reflect broader trends shaping the future of AML compliance. Greater emphasis on contextual risk assessment, authority verification and proportionate due diligence demonstrates the regulator’s expectation that firms adopt smarter, more risk-sensitive approaches to financial crime prevention.

For compliance teams, now is the ideal time to review existing controls and identify opportunities to strengthen onboarding, verification and monitoring processes before these changes become fully embedded in industry practice.

By taking proactive steps today, organisations can reduce regulatory risk, improve operational resilience and build stronger defences against increasingly sophisticated financial crime threats.

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