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Money laundering illustration

Accounting dilemmas: AML obligations


Sometimes in business, you can find that company ‘policy’ is more in the imagination of middle management then committed to paper. AAT’s head of professional standards Adam Williamson considers what happens when firms have not followed requirements to publish an anti-money laundering policy.

17th Sep 2019
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One major part of an accountant’s role is dealing with the various ways of working that different clients have. This could be to do with the systems they use, the way they gather information, or the depth of the policies they have in place.

Take the following situation, for example:

The scenario

While working as a sub-contractor, you have been engaged by a medium-sized accountancy firm, which has three chartered accountant partners.

You are assigned to a longstanding account and after a few days, you become aware that there appears to be little in the way of client onboarding information. This appears to be similar to other client accounts.

You request a copy of the firm’s anti-money laundering (AML) policy in order to familiarise yourself with their processes.

However, you are told that there is no such policy, in written form at least, but that each team has someone who ‘deals with that side of things’.

What should you do?

Considerations and actions

It seems quite clear that this firm is not meeting its AML regulations.

As a minimum, the 2017 MLR regulations require the following to be carried out:

  • Client due diligence checks on every client. These must be documented, reviewed, and updated on an annual basis.
  • An overall risk assessment for the firm, also updated and reviewed annually.
  • A documented AML policy, which is available to all staff members.

It is your responsibility, at this stage, to raise the issues directly with the partners. If changes are not immediately implemented in order to ensure the firm is AML compliant, you should disengage.

In addition, you may wish to consider raising the matter with the relevant AML supervisor for the company and (if the supervisor is not a professional body) the professional bodies of which the partners are members.

Replies (3)

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David Winch
By David Winch
18th Sep 2019 10:03

Does the AAT require the firm's risk assessment to be updated and reviewed ANNUALLY?

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Replying to davidwinch:
By Adam Williamson
07th Oct 2019 08:49

Thanks for the query, David. As the regulations specifically require the firm records in relation to risk assessments to be 'up to date', AAT considers an annual review to be best practice. Of course, every time something of significance happens to the practice, this should also be an opportunity for review.

Thanks (0)
By philaccountant
18th Sep 2019 10:34

The big 4 along with large multi-national banks wash 99.9% of the worlds dirty money whilst taking legislators and government officials out to lunch to cut deals over the token fines they should pay when they're (infrequently) caught.

Us on the ground get threatened with disgrace and ruin because a subby might have pocketed some cash you don't know about.

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