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The appellant operated a foreign exchange business. The value of the handling transactions was approximately £1.5 million to £2 million a year.
HMRC found a number of errors in the appellant’s verification and record-keeping requirements, as imposed by the Money Laundering Regulations, and issued two warnings.
After a third irregularity was found, the department issued £500 penalties. The appellant appealed.
The tribunal judge found that the appellant’s record-keeping was poor and that he had not been engaged in money laundering activities.
However, this was not a proper excuse. Money services businesses had to comply with the requirements and failure to do so was a serious matter.
The appellant had been warned by HMRC on two occasions, and the penalties imposed were comparatively lenient. It would not be appropriate to adjust the penalties.
The taxpayer’s appeal was dismissed.
