Money Laundering – what are the facts?
Accountants are key gatekeepers for the financial system, facilitating vital transactions that underpin the UK economy. So when it comes to money laundering, what are the facts?
Here at The Hollies, Bookkeepers in Shropshire, we have been undertaking an Anti-Money Laundering review for our practice licence and will be doing some further training.
Accountants and bookkeepers have a significant role to play in ensuring their services are not used to further a criminal purpose.
As professionals, we must act with integrity and uphold the law, and must not engage in criminal activity.
Money laundering is defined very widely in UK law. It includes all forms of using or possessing criminal property (as well as facilitating the use or possession) regardless of how it was obtained.
Money laundering can involve the proceeds of offending in the UK, but also of conduct overseas that would have been an offence had it taken place in the UK.
There is no need for the proceeds to pass through the UK.
Businesses need to be alert to the risks posed by:
- Employees and
- The customers, suppliers, employees and associates of clients.
Neither the business nor its client needs to have been party to money laundering for a reporting obligation to arise.
Inside or outside the regulated sector someone commits a money laundering offence if they:
- Conceal, disguise, convert, transfer or remove criminal property from England and Wales, Scotland or Northern Ireland;
- Enter into, or become involved in, an arrangement which they know or suspect facilitates the acquisition, retention, use or control of criminal property by or on behalf of another person or
- Acquire, use or possess criminal property for which adequate consideration was not provided.
Any of these offences is punishable by up to 14 years’ imprisonment and/or an unlimited fine.
If a business fails to meet its obligations under the 2017 Regulations, civil penalties or criminal sanctions can be imposed on the business and any individuals deemed responsible.
This could include anyone in a senior position who neglected their own responsibilities or agreed to something that resulted in the compliance failure.
Appropriate policies and procedures
Every business must have appropriate policies and procedures for assessing and managing Money Laundering and Terrorist Financing (MLTF) risks.
To focus resources on the areas of greatest risk, a risk-based approach should be adopted.
It is the ultimate responsibility of the board member or member of senior management responsible for compliance to identify the risks and then develop risk based procedures for taking on new clients.
Records should be kept
Businesses must be able to demonstrate to their anti-money laundering supervisory authority how they assess and seek to mitigate MLTF risks.
This assessment must be documented, and made available to the anti-money laundering supervisory authority on request.
The documentation should demonstrate how the risk assessment informs their policies and procedures.
Who should be trained and who is responsible for it?
The regulations require that all ‘relevant employees’ (including partners) are made aware of MLTF law. They must also be trained regularly to recognise and deal with transactions which may be related to MLTF, as well as to identify and report anything that gives grounds for suspicion (see Section six of this guidance).
We are committed to upholding the law at our practice in all that we do.
Our ongoing training in areas such as this enable us to stay at the top of our game, be properly licenced and enable us to offer you the best and most trustworthy advice.
For any help on this matter, don’t hesitate to call us on 01743 790086 or email us at firstname.lastname@example.org