Our apparent inability to spot suspicious activity is even more surprising because many of the services we offer are mentioned by the Financial Action Task Force in its list of key risks for the profession. We know we have to be vigilant in giving financial and tax advice, for instance, lest we end up advising corrupt high net worth individuals and politically exposed persons or stand accused of creating corporate vehicles and other complex legal arrangements to disguise the links between the proceeds of a crime and the perpetrator.
At the CCAB event, Donald Toon of the NCA quoted the Treasury’s 2015 and 2017 National Risk Assessments, which identified complicit accountancy professionals as a vulnerability. He related a case where an individual, who was a joint director with a Russian national of a UK-registered company, supposedly set up to offer high value leisure services. They used the company to move $60m through jurisdictions including Russia, Cyprus, Latvia and the British Virgin Islands.
There are people within the accountancy profession, Toon said, who are prepared to engage in providing professional services to serious and organised criminality. Fortunately, they are few and far between. Nobody, he stressed, was suggesting that the profession as a whole was corrupt. There was, though, a real issue that we needed to be clear about. “While we may be talking about a small number who are complicit, complex money-laundering schemes cannot operate effectively without the skills and the veneer of legitimacy provided by the professional sector, particularly accountancy, trust and company services provision and the legal sector. Some will be directly involved, some will be careless, some will simply fail to spot and understand risk.”
I came away from the event profoundly saddened that we as a profession stand accused of not doing enough to combat crime. While the “small number” referred to by Donald Toon may in part explain the low level of SARs, and we will always be playing catch up with the banks (whose algorithmic software will highlight unusual transactions), we can’t ignore the fact that SARs from the profession have fallen. Let’s make it a new year’s resolution to improve our record in 2018.