High Value Dealers
HMRC found non-compliance in 43% of visits. The most common failure was not the absence of a process.
HMRC found non-compliance in 43% of onsite visits in 2023-24. 977 fines were issued totalling over £5 million. The most common failure was not the absence of a process — it was the absence of a record showing the process had been followed.
From May 2025, every HVD must report to OFSI as soon as practicable if they know or suspect a client has breached financial sanctions. The UK Sanctions List is the only authoritative list from 28 January 2026.
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The regulatory landscape
High value dealers are HMRC-supervised for AML with firm-wide risk assessment, threshold transaction procedures, CDD, SAR logging, training and five-year retention. Proliferation financing risk must be reflected in the risk assessment — generic art-market templates are a known inspection failure mode.
Threshold transactions trigger enhanced scrutiny: source of funds, beneficial ownership, and sanctions screening against the UK Sanctions List. Records must show reasoning — not just tick-box collection.
OFSI reporting obligations require knowledge/suspicion to be escalated as soon as practicable. A policy without a dated operational trail is a policy that cannot be proved.
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What regulators look for
HMRC inspectors ask for the risk assessment first — is it specific to your stock, clients, geographies and payment channels? Then they drill into transaction files: was CDD reasoning recorded at the time, were sanctions screens logged, were SAR decisions documented including non-reports?
The 43% non-compliance statistic is not about villains — it is about documentation. Inspectors see good intentions with poor files every week.
OFSI and NCA interest in art and luxury markets continues — expect cross-agency reading of your records.
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What Evidentia gives you
Transaction CDD records
Each qualifying deal sealed with risk reasoning, sanctions outcome, and source-of-funds steps — inspection-ready.
Firm-wide risk assessment trail
Updates, approvals and proliferation financing considerations recorded — not a PDF that silently goes stale.
OFSI reporting evidence
Knowledge/suspicion events logged with timing and decision — the contemporaneous account regulators expect.
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The evidence gap
Most HVDs we speak to know their clients and their stock. The gap is the file: screens done verbally, CDD reasoning in a dealer's head, SAR edge cases never logged.
HMRC does not grade intent — it grades what you can produce when the visit starts.
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Key enforcement facts
HMRC found non-compliance in 43% of onsite visits in 2023-24 — documentation failures dominated.
977 AML penalties issued in that period — over £5 million — HMRC estate and high-value dealer supervision.
UK Sanctions List only from 28 January 2026 — screening records must show list version and outcome.
Find out whether your current approach would withstand scrutiny.
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