The Personal Investment Management & Financial Advice Association (PIMFA) and law firm Macfarlanes have published guidance on how wealth managers and financial advisers can use information sharing provisions set out in the Economic Crime and Corporate Transparency Act 2023 (ECCTA).

It highlights how wealth managers and advisers can use the information sharing provisions to prevent, detect, and investigate financial crime.

The ECCTA information sharing provisions came into force in January 2024 and allow AML-regulated firms to share information relating to financial crime with one another, and introduced statutory protections around confidentiality and removed civil liability for firms when using the gateways.

The guidance for PIMFA member firms provides explanations and frameworks to help them feel confident in sharing information under the new gateways, as the uptake of the new powers has been limited.

According to PIMFA members, this lack of use was driven by a combination of low awareness, legal uncertainty, and operational hesitation, rather than a lack of relevance or need.

The guidance has been designed to tackle these challenges by raising awareness of the information sharing gateways and providing explanations of how they operate.

It includes a legal summary of the provisions, guidance on how they interact with existing obligations, and step-by-step processes outlining what firms should do when sharing or requesting information.

Additionally, the guidance provides template forms for direct information sharing, case studies on how the gateways can be used in practice, and an overview of the benefits of information sharing, alongside the primary adoption barriers and suggestions of how to overcome them.

"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,” commented PIMFA head of regulatory policy and compliance, Alex Roberts.

“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."

Macfarlanes partner, Laura Bridgewater, 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.

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