The Role of Accountants in the Fight against Money Laundering

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1 The Role of Accountants in the Fight against Money Laundering Presentation by: Felicity Banks Head of Business Law Institute of Chartered Accountants in England & Wales

2 Money Laundering and Terrorist Financing The process by which criminals retain, disguise and conceal the proceeds of their crimes The process by which funds are raised, consolidated and retained for use in financing terrorism

3 IFAC Code of Ethics Introduction and Fundamental Principles A distinguishing mark of the accountancy profession is its acceptance of the responsibility to act in the public interest.

4 The Role of Accountants Professional accountants provide relevant information to those entitled to it, enabling them to perform their legitimate functions

5 Anti-money laundering requirements National law and regulation Regional law and regulation Global requirements

6 Anti-money laundering requirements National law and regulation Regional law and regulation Global requirements The 40+9 Recommendations of the Financial Action Task Force/Groupe d Action Financière

7 FATF Recommendations for Accountants Due diligence - identifying new clients Due diligence - continuing alertness Record keeping Systems and training Suspicion reporting

8 Scope of FATF Recommendations Accountants in practice are included when assisting clients in: buying and selling of real estate; managing client money, securities or other assets; managing bank, savings or securities accounts; organising contributions for the creation, operation or management of companies; creating, operating or managing legal persons or arrangements, and buying and selling businesses.

9 Scope of FATF Recommendations Lawyers, notaries, other independent legal professionals and accountants should be required to report suspicious transactions [to the proper authorities] when, on behalf of or for a client, they engage in a financial transaction in relation to these activities.

10 Scope of FATF Recommendations Lawyers, notaries, other independent legal professionals and accountants should be required to report suspicious transactions [to the proper authorities] when, on behalf of or for a client, they engage in a financial transaction in relation to these activities. Countries are strongly encouraged to extend the reporting requirement to all the professional activities of accountants in practice, including auditing.

11 Scope of FATF Recommendations Neither legal professionals nor accountants are required to report their suspicions if the relevant information was obtained in circumstances where they are subject to professional secrecy or legal professional privilege.

12 Scope of FATF Recommendations Neither legal professionals nor accountants are required to report their suspicions if the relevant information was obtained in circumstances where they are subject to professional secrecy or legal professional privilege. But can we rely on this, if it is clearly in the public interest to report to the authorities?

13 The Role of Accountants Professional accountants provide relevant information to those entitled to it, enabling them to perform their legitimate functions All society benefits when fair laws are enforced fairly. Accountants should assist law enforcement by reporting money laundering

14 MAJOR PLAYERS FATF/GAFI Financial Action Task Force - NATIONAL AND INTERNATIONAL JURISDICTIONS Eg European Union - internal_market/company/financial-crime/index_en.htm INTERNATIONAL INTELLIGENCE ORGANISATIONS The Egmont Group - SOURCES OF GUIDANCE