HM Treasury has approved the final 2022 version of the Consultative Committee of Accountancy Bodies’ (CCAB’s) anti-money laundering (AML) guidance for the accountancy sector.
The new guidance incorporates changes introduced to the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 from January 2020, when the EU Fifth Anti-Money Laundering Directive (5AMLD) was transposed into UK law. It is aimed at providers of audit, accountancy, tax advisory, insolvency, or trust and company services in the UK. The UK money laundering supervisory bodies for the accountancy profession have also approved and adopted it.
The guidance is based on the law and regulations as of 13 July 2021 and replaces the draft guidance published in September 2020. References to the legislation have been updated to reflect the UK’s exit from the EU, although most of the EU requirements remain, apart from some regulations relating to EU lists of high-risk countries. The guidance also now provides several interpretations of existing AML guidance.
Firms that discover discrepancies in the register of people with significant control must now report them to Companies House within 15 working days, instead of the 30-day grace period previously allowed. This is intended to give the firm an opportunity to discuss the potential discrepancy with the client to establish whether an inadvertent error has been made and can be corrected without delay.
Wording of some of the requirements has been changed from ‘should’ to ‘must’ to strengthen firms’ interpretations of the guidance. These strengthened requirements include firm-wide risk assessments; new services, products, or ways of working; employee screening; and certain rules regarding client due-diligence and politically exposed persons. The guidance also clarifies the wording around enhanced due-diligence for an occasional transaction where there are connections to a high-risk third country.
CCAB also presents an amended interpretation of who should be considered as a firm’s agent for the purposes of training agents on client due-diligence and suspicious activity reports (SARs). The ‘reasonable excuse’ defence for failing to make a SAR has been extended to the accountancy sector, to bring it into line with the legal sector. It now includes situations where all relevant facts are in the public domain or law enforcement are aware of all the relevant details.
There is also an expanded list of red flags to help spot money laundering and terrorist financing transactions. New case studies on identifying beneficial owners for customer due-diligence are also supplied, covering a range of client types and structures. Situations arising where a defence against money laundering request is neither granted nor refused by the National Crime Agency are also addressed.