The UK government’s plans to reform the country’s anti-money laundering (AML) regime will expose accountants and other businesses to a greater risk of financial crimes, professional body the Association of Accounting Technicians (AAT) has warned.
Adam Harper, Director of Professional Standards and Policy at AAT, has urged the government to rethink plans to consolidate AML supervision under one regulatory body, according to a report in Business Matters, following concerns that such a move could cause enormous disruption, expose businesses to money-laundering risk, and weaken AML oversight across the country.
HM Treasury revealed in June its proposals to reform the UK’s anti-money laundering and counter-terrorism financing supervisory system.
In its consultation document ‘Reform of the Anti-Money Laundering and Counter-Terrorism Financing Supervisory Regime’, published on 30 June 2023, the Treasury outlined four potential models for future AML supervision, two of which involved a single state regulator, which could potentially be a single private company.
However, AAT, which represents accountancy professionals and has approximately 124,000 members worldwide, has warned that this could harm the accountancy sector and other UK businesses.
“Some of the government’s new proposals, including plans to create a private body to police money-laundering rules for all professional services, could potentially open the floodgates to organised criminals seeking to launder money in the UK,” warned Harper.
“The current system, whilst not perfect, ensures that each profession meets anti-money laundering rules which are tailored to their specific professions. Dramatically shifting to a new model, as set out in some of the Treasury’s plans, could lose that specialist know-how and weaken the anti-money laundering system that is in place,” he continued.
Currently, AAT acts as a money-laundering supervisor for AAT Licensed Accountants and Bookkeepers who provide accounting and bookkeeping services to clients and is supervised by the Office for Professional Body Anti-Money Laundering Supervision (OPBAS), a regulator set up by the government to strengthen the UK’s AML supervisory regime.
OPBAS regulates over 20 professional bodies and ensures that professional bodies’ AML supervisors comply with AML requirements.
An overhaul of the current regime would be preferable, believes Harper. “We are urging the Treasury to strengthen the current system rather than attempt to dismantle and rebuild the whole AML regime, which brings with it major risks for the UK’s small and medium-sized businesses, who make up the backbone of UK plc,” he said.
The three-month consultation into AML regulatory reform is set to close on 30 September. To read the full document, click here.
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