"Financial advisers are often closer to their clients than banks or other intermediaries, putting them in a unique position to spot unusual activity or emerging risks."
- Alex Roberts, head of regulatory policy and compliance at PIMFA
Trade association PIMFA has published new guidance for firms on using the information sharing provisions in the Economic Crime and Corporate Transparency Act 2023 (ECCTA).
The guide, developed in collaboration with law firm Macfarlanes, provides practical explanations and frameworks to give firms the confidence to share information under the new gateways.
The ECCTA information sharing provisions enable AML regulated firms to share relevant information with each other for the purposes of preventing, detecting or investigating economic crime. The provisions introduce statutory protections around confidentiality and remove civil liability for firms when using the gateways.
Despite strong support from regulators and policymakers, uptake of the new powers has been limited. PIMFA member feedback suggests this is due to a combination of low awareness, legal uncertainty and operational hesitation, rather than any lack of relevance or need.
The guidance aims to address these barriers by raising awareness of the ECCTA information sharing gateways and providing clear explanations of how they operate in practice. The guide includes:
• A legal summary of the information sharing provisions, explaining the two methods of sharing (direct and indirect) and the conditions that must be met to use them.
• Practical guidance on how the provisions interact with existing obligations, including UK GDPR, the Data Protection Act 2018, confidentiality duties and tipping-off restrictions under POCA.
• Step by step processes setting out what firms should do when sharing or requesting information, from confirming the legal basis through to secure transmission and record-keeping.
• Template forms for direct sharing under both the Warning and Request scenarios, designed to be tailored by individual firms.
• Real world case studies illustrating how the gateways can be used in practice, including customer offboarding, safeguarding vulnerable clients and responding to requests from other firms.
• An overview of the benefits of information sharing, alongside the common barriers to adoption and suggested ways to overcome them.
Alex Roberts, head of regulatory policy and compliance at PIMFA, said: "Wealth managers and financial advisers are often closer to their clients than banks or other intermediaries, putting them in a unique position to spot unusual activity or emerging risks. But tackling economic crime effectively requires strong controls within individual firms, alongside timely and confident information sharing across the financial system.
"The ECCTA gateways provide a clear legal mechanism for that collaboration, with important protections for firms that share in good faith. This guidance is designed to give our members the practical tools and confidence to use those powers in a way that is responsible, proportionate and effective."
Lorna Emson at Macfarlanes commented: "There is potential for those engaged in financial crime to exploit the gaps between regulated firms, aware that no single institution holds the complete picture. The ECCTA gateways seek to address those gaps and facilitate collaboration, with statutory protections for firms sharing information in good faith.”
Laura Bridgewater at Macfarlanes added: "The ECCTA information sharing provisions are a significant development in the fight against economic crime, but their effectiveness depends on firms knowing how to use them. This guidance provides wealth managers and financial advisers with a clear framework for sharing information lawfully and securely."
