Earlier this month (March), HMRC published a press release which highlighted actions taken by HMRC officers for the non-compliance of anti-money laundering provisions. They visited 50 estate agents across England (70% of them were in London) after they were suspected of trading without being registered as required under money laundering regulations. They penalised these estate agents for their failures, and one of the national estate agents, Countrywide Estate Agents, received a fine of £215,000.
Simon York, Director of HMRC’s Fraud Investigation Service, said: ‘Estate agents need to understand that criminals prey on weaknesses, so it’s vital they take all steps to protect themselves. The money laundering regulations are key to that, but there’s still a minority of agents who ignore their legal obligations. These inspections are a wake-up call that if you continue to trade illegally we will come knocking.’
If you advise any business falling within the regulations please highlight the obligations they have to them. As a reminder the basic rules are:
What are money laundering regulations?
The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLR 2017) came into force on 26 June 2017. They implement the EU's 4th Directive on Money Laundering. Anti-money laundering refers to a set of regulations, laws and procedures designed to stop the practice of generating income through illegal actions.
Obligations for accountants and auditors
If your firm in the UK is controlled by ACCA members (ie at least half of the partners/directors are members of the ACCA and the ACCA partners/directors control at least 51% of the voting rights) or holds an auditing certificate from the ACCA, you/your firm are automatically supervised by ACCA. This means that you do not need to register with any other supervisory body for the money laundering supervision.
ACCA did ask its member practitioners to provide AML information for their practices last year, including the BOOM and TCSP services information. Money laundering procedures are based on the risk assessment of an individual client and business, hence the questionnaire was devised to identify what level of risks are taken by practices and how they are addressed in their due diligence procedures.
you have a strict internal money laundering policy and procedure to adhere to
all staff members have an appropriate level of training on how to handle any suspicious money laundering situations and their reporting requirements
you exercise professional scepticism and judgement at all times
you create and maintain the business’s risk based approach to preventing MLTF
you document the assessment of the operations and effectiveness of the business’s AML systems and controls annually
all money laundering documents are regularly reviewed and updated
you retain all client identification records for at least five years after the end of the client relationship
if you have to make any suspicious activity report (SAR) about any money laundering activity, you know how to do this to National Crime Agency (NCA)
you shall not ‘tip off’ a client that a report has been made. In particular, ceasing to act for a client without giving any plausible explanation might tip off the client that a report has been made. However, any attempts to persuade a client not to proceed with an intended crime will not constitute tipping off.