MLR3C10385 - Accountancy Service Providers (ASPs): ASPs and general Money Laundering risks

As ASPs have an insight into the financial affairs of their clients they are in a position where they may have reason to suspect that their client is involved in money laundering activity. This activity is likely to be one of the following:

• The client is directly engaged in criminal activity. For example criminals have been known to buy businesses where a high volume of the turnover is represented by cash sales. Criminally obtained cash is introduced into the business by inflating the takings. The criminal then has an explanation for his apparent wealth which appears to be derived from a legitimate source.
• The client is supplying goods and services to criminals, is accepting high value payments and may even be an unregistered HVD.
• The client is involved in tax evasion. Money retained through tax evasion is criminal property and therefore money laundering.

Accountants, tax advisers and bookkeepers are likely to be better placed than payroll agents or stocktakers to identify suspicious activity in their clients’ affairs. This is because they get a fuller picture of their clients’ business activity as they will have access to full trading records and bank accounts. A stocktaker or payroll agent is employed to do a specific task and may only see a limited amount of information.