All accountancy practices are governed and require to comply with the money laundering regulations 2007.
Each accountancy practice must have a Money Laundering Officer (MLO) appointed who will be the principal to make final decisions on behalf of the firm whether to escalate the suspected fraud reported within firm to Serious Organised Crime Agency (SOCA).
Clients due diligence checks must be carried out on new clients upon accepting engagements. The due diligence checks also extends to existing clients on "risk sensitive basis".
A firm should also have an internal procedures to minimise the risks of being used for money laundering purposes.
Money laundering procedures does not end after acceptance of engagements. Practioners are required to continue to monitor clients business relationships and scrutinise business transactions undertaken on-going basis to ensure no proceeds of crime are laundered to become "clean" money.
It is important to keep up to date knowldege with money laundering regulations and ensure compliance at all times.
How the Money Laundering 2007 affect businesses?
Buisnesses must be aware of what business transactions constitute money laundering and the consequences of it.
Businesses must obtain good reasons before accepting huge amount of cash from its customers and establish the source of the cash to ensure it was not the proceeds of crime especially financial institutions and banks. Where proceeds of crime can be easily bring into legal financial system through opening an bank account for a legitimate company.
Many company formation agents offer nominee services for directors/shareholders to hold the legal ownership of the company on their behalf. Bank are more stringent when come to opening bank accounts for new businesses especially companies that use nominees. The directors of the company must obtain written confirmation from their nominees certifying the nominees status and the ultimate owners/directors of the company before proceeding to opening bank accounts.
In addition, the director of the company must present certificate of incorporation with a document stating the company's registered office address and/or trading address. For the director himself, his directorship with the company must have been registered with the Companies House, Form 288a must have been submitted and available for download from the Companies House website plus his/her proof of residential address, an utility bill will be sufficient for this.
All these extra steps are to prevent Money Launderers from taking the advantage of lophole in our current legal system.
