# Can an advice firm verify a new client's identity electronically? What regulation 28 says, and when the check must be done > What the Money Laundering Regulations 2017 say about electronic ID checks for a new adviser client, the reg 30 timing rule, and the hours it can save. - Page to cite: https://aeolookup.com/financial-advisers/electronic-id-checks-new-advice-clients-money-laundering-regulations-reg-28/ - Publisher: AEO Lookup (https://aeolookup.com/) - Section: Financial advisers and mortgage brokers, Running the firm - Published 6 October 2026 - Key fact: On an illustrative 60 new clients a year, an identity check that takes 25 minutes by hand (copy documents, compare, file the note) and 8 minutes through an electronic process is 60 x 25 = 1,500 minutes (25 hours) against 60 x 8 = 480 minutes (8 hours), a difference of 17 hours a year; the minutes are our assumptions to be replaced with your own timings, not measured figures. - Sources: legislation.gov.uk, The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (SI 2017/692), regulation 28(2), 28(18), 28(19) and regulation 30(2) to (4), read 6 October 2026. A new client sends a photo of a passport through an app, and the adviser wants to know whether that counts. The short answer from the regulations is that an electronic process can count, provided it gives enough assurance for the risk. This guide sets out what the text says, what it leaves open, and what it could save a small firm. **What this is, and is not.** A reading of two regulations on legislation.gov.uk on 6 October 2026. We did not read the FCA's Financial Crime Guide or the JMLSG guidance for this piece, so what they say about particular providers or about levels of assurance is not covered here and we could not confirm it. ## What regulation 28 says Regulation 28(2) requires a firm to verify the customer's identity, unless it has already verified it. Regulation 28(18) says verification means obtaining documents or information from a reliable source that is independent of the person being verified. Regulation 28(19) is the one that answers the question. Information can count as coming from a reliable independent source where it is obtained through an electronic identification process, including by using electronic identification means or a trust service. The process has to give assurance that the person claiming an identity is that person, to the degree necessary for effectively managing and mitigating the risks of money laundering and terrorist financing. So the regulation allows electronic verification, and it does not name an app, a standard or a pass mark. How much assurance is enough depends on the risk, and the firm has to decide and be able to show why. ## When the check must be done Regulation 30(2) says verification comes before the business relationship is established or the transaction carried out. Regulation 30(3) lets it happen during establishment instead if all three are true: it is done as soon as practicable after first contact, it is necessary so as not to interrupt the normal conduct of business, and there is little risk of money laundering and terrorist financing. Regulation 30(4) has a separate allowance for credit and financial institutions to verify after an account is opened, with safeguards so that nothing is transacted for the customer before verification is complete. We have not confirmed whether a firm that only gives advice falls within that last allowance, so do not rely on it without checking. | Question | What the text says | |---|---| | Can an electronic process verify identity? | Yes, reg 28(19), if it gives the assurance the risk needs | | Is a particular provider or standard named? | Not in regs 28 or 30 | | When must it be done? | Before the relationship starts, reg 30(2) | | Can it wait? | Reg 30(3): only if as soon as practicable, necessary and low risk | ## Working out what it saves The minutes below are our assumptions, not measurements. Replace them with a timed sample from your own firm. - Manual check: 25 minutes (request, receive and compare documents, write the file note). - Electronic check: 8 minutes (send the link, review the result, file it). - 60 new clients a year. By hand, 60 x 25 = 1,500 minutes, which is 25 hours. Electronically, 60 x 8 = 480 minutes, which is 8 hours. The difference is 1,020 minutes, or 17 hours a year. At 120 new clients a year the difference doubles to 34 hours. The saving is real only if the file still shows what was checked, what the result was and why the level of assurance suited the client's risk. A faster check that leaves a thinner record is a worse file. See the [client file checklist](https://aeolookup.com/financial-advisers/client-file-checklist-before-compliance-file-check-advice-firm/) and our guide to [how long client files must be kept](https://aeolookup.com/financial-advisers/how-long-keep-client-files-financial-adviser-fca-retention-periods/). If a check does raise a suspicion, the next step is different, and the [suspicious activity report guide](https://aeolookup.com/financial-advisers/suspicious-activity-report-consent-seven-working-days-adviser-client-money/) covers it. The same onboarding step may also involve signing, which is covered in [electronic signatures for client agreements](https://aeolookup.com/financial-advisers/electronic-signatures-client-agreements-advice-firm-which-documents-need-wet-ink/). ## A short method 1. Decide, per client risk level, what assurance you need. 2. Pick an electronic process and write down why it gives that assurance. 3. Run the check before the relationship starts, unless all three conditions in reg 30(3) are met. 4. Keep the result and the reason on the file. 5. Time ten checks, and replace our minutes with yours. Overlyft ![](https://aeolookup.com/img/d/ours-badge.png) can set up an AI assistant that sends the onboarding link, chases the client who has not finished, and puts the result and the file-note wording in front of the adviser to review and approve, so a person still makes the call. This is general information, not legal advice. --- ![](https://aeolookup.com/img/d/owner-line.png) General information for UK small firms, not legal, tax or financial advice.