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ICAEW takes the chair at the AML Supervisors Forum

ICAEW continues to be at the forefront of Anti Money Laundering (AML) supervision and now, throughout 2021, ICAEW’s Michelle Giddings, Head of AML, has been elected as Chair of the AML Supervisors Forum, set up by HM Treasury under the 2007 Money Laundering Regulations.

Giddings says: “The AML landscape has changed significantly over the last few years. Firstly, there was the creation of the Office for Professional Body Anti-Money Laundering Supervision (OPBAS) and the increased level of oversight that professional body supervisors now have in relation to AML, but also there is the creation of the government's economic plan, and the fight against economic crime.”

She says there is a changing role for accountancy professional body supervisors within the AML supervisory space too. The topic of money laundering is being elevated across government, the professions, business, regulation, and is very much on the minds of the general public. “We've really underplayed and undersold the extensive work that we’ve done as a supervisory authority for a number of years. But, government, and other public sector bodies, are now placing a lot of emphasis on our role as an AML supervisor. ICAEW needs to explain how we have met, and continue to meet the challenge.”

“ICAEW has always been the largest accountancy body supervisor, and we supervise the largest firms. My role as Chair of the Supervisors Forum allows us to direct the agenda to cover topics that concern the accountancy profession and our firms.”

“This year, we're going to use the forum to continue the drive for more consistency and sharing of best practice amongst the supervisors. The Forum also gives us a united voice when new issues arise, or new areas of policy come out of government that require a response from the professional bodies and statutory supervisors.”

There will be change for firms too as there will be a bigger expectation on them to understand what the risks are. “We’ve been working hard over the past couple of years to share risk information with our firms. There is an expectation on the firms that they're reading and absorbing that information and putting it into practice when they take on clients,” she says.

ICAEW has sent its supervised firms information about how criminals work, about how they might try to infiltrate accountancy firms or try to use the services of accountancy firms to give themselves that veneer of respectability. Giddings adds: “We are highlighting the risks that firms should look for. There is now even more need for this, given concerns about new AML risks that may have arisen in the context of the government support schemes offered during the pandemic for example.”

Other big concerns relate to suspicious activity reports (SARs) – firms should provide all the information necessary in the clearest way possible, and staff should be trained to achieve this.

Giddings points out that professional scepticism is also vital in the AML space. “This is a phrase that we normally only really talk about in relation to audit, but actually professional scepticism in this context is really important. There is an expectation by the public that accountants, when they're looking at businesses and their underlying books and records, will be employing some healthy doses of professional scepticism. In 2021, that will be especially important when looking all the government support schemes and making sure that all of those COVID financial assistance claims were valid and legitimate.”

The Forum works with key government agencies focussed on developing and supporting the AML regime. In particular, the following agencies work closely with the Forum: the NCA (including the FIU, NECC and outreach teams that work with supervisors); HM Treasury; the Home Office; OPBAS; and HMRC (in its role as a law enforcement agency and an AML supervisor).

It is envisaged that representatives from leading AML expert groups will be invited by the Chair to attend meetings. Representatives from other leading law enforcement and security agencies will also be invited by the Chair to engage with the forum, according to changing topical priorities and requests from the Forum (for example, the SFO and the National Cyber Security Centre).

In 2021, Giddings plans to run a series of workshops within the Forum to enable supervisory authorities to share best practice. “This year I aim to make sure that we've got more dialogue between the supervisors about their supervisory activity, and how they apply their risk-based approach to supervision, rather than only focusing on legislative change or policy development, for example,” says Giddings.

Access more information about ICAEW’s AML supervisory role and guidance on SARs.