AML guidance updated for tax practitioners
Richard Simms, the managing director of FA Simms and AMLCC, summarises the Supplementary Anti-Money Laundering Guidance for Tax Practitioners and highlights the key areas practitioners should be aware of.
Replies (12)
Please login or register to join the discussion.
I am sure we are typical of a small practice where the most likely laundering we will come across is under declaring takings and VAT evasion, just like every other practice we have in the past sent in reports about this, not once has this even led to an enquiry despite the figures involved being substantial - so whats the point?
Some years ago I represented a client whom had been selected by HMRC for enquiry following a money laundering disclosure by a bank [a large cash deposit]. The HMRC officers were quite open when they said they 'cherry pick' the best cases since there are too many for them to investigate. I'm afraid there is a point to disclosure although the system could be managed better i.e no need to make a MLR disclosure if HMRC are already aware or about to be made aware of a tax disclosure/evasion. It results in duplication a waste of time.
So how much money has been spent on all this by all of us, and how much has it prevented being laundered.
Each of us spend hours and hours ensuring we comply with this huge pile of regulation, so the costs must run into £100m's and probably more.
Total benefit for us: zero.
Total amount caught: probably close to zero. Most criminals with large pots of money will find a way around these rules.
When it gets to the stage where a client making a genuine error might need to be reported on a NCA, you know it's all gone too far.
Drowning people in regulation.
I had to deal with the serious crime office for a report I made.....there were other issues but they added my report to the case against the (very ex) client. They do follow up
The sole purpose of all this regulation is for the UK to comply with its international treaty obligations. Whether or not it actually achieves anything is incidental.
Most of the money-laundering I hear/read about seems to go through banks and other financial institutions, not the ordinary accountant doing small tax returns for members of the public.
All this mindless compliance is actually, government blame-shifting and demanding practitioners will do government's work for free.
Since, of course, the Western World suffers from totally weak and useless government.
I personally doubt Joe Blow the plumber is involved in massive terrorist funding. If he were, then how would I really know?
Perhaps I might, if Joe popped into my office accompanied by three heavy geezers carrying AK47s and grenades...
The obvious point for governments to start is the damned bankers.
Surely?
The World is awash with financial regulatory agencies!
Amongst them IMF: as well as:
https://en.wikipedia.org/wiki/Financial_regulation
https://en.wikipedia.org/wiki/Bank_regulation
Now, terrorism tends to be an international and cross-border activity: as does major illegal drugs importation and distribution.
In the mid 1970s to early 1980 I worked on international finance all over the place and I could tell some stories about illegality and naughtiness that would make your hair curl!
It ought not to be my damned job to properly report on areas where national authorities are too useless: and make me PAY for the privilege, just in the cause of trying to earn my living. And worse, if I fail I could finish up bankrupt and/or in stir!
I used to be the MLRO in one of my previous jobs. I wasn't a partner/director in the firm, just a manager, but the guy running the place was a c*ck and refused to do it himself.
Anyway, over a 5 year period I made about 100 reports to SOCA, as it was at the time, mostly low level stuff. I reported the same client 5 times and, in one report, insulted him, calling him "a piece of human detritus".
That triggered a visit where they told me off for my language, as it may have had to be read out in court, but they also told me 2 of the clients I had reported had been flagged as "of interest" to the Police. They couldn't tell me more and I don't know what happened as I haven't worked there for 7 years. Sadly, the same c*ck is still running the place albeit under a different name.
It illustrates that they do take notice of the reports we make.
The anecdotal evidence of following up reports doesn't inspire me given they mention the SOCA which was disbanded in 2013.
I have no doubt that some effort may be made to cross check on existing cases against people already on the radar but I doubt the information we provide about minor VAT errors or unsubmitted tax returns make much odds.
I object to the tone of censure that accountants are letting the side down by not making enough reports compared to the banks. Aside from the fact that we are engaged in entirely different services, I take it that I am doing a reasonable job in judging who I work with and what work I take on.
If this information was simply sent to HMRC in the first place it would make a lot more sense but then we would have to face up to the fact we are common snitches rather than guardians of the financial sector against terrorism, medal awards pending.
I had a SOCA - as it then was - which I think was acted on. The coffee shop business had very good records in terms of till receipts and invoices, but I could not help noticing signs of drug use in the owner. Anyway, having done the VAT returns off the source records it came time for the year-end, which I insisted required bank statments.
NO.
I insisted again, saying I would need to resign without them.
NO.
I resigned and did the SOCA. A few months later the shop closed. If I had to put money on it, I suspect the bank statements might have shown £400k in takings compared to the £150k of coffee shop takings. Organised crime is a lot more than just terrorism.
Out of interest how do you know your report was acted upon? If you had resigned by the time it closed how do you know what caused the closure