The Association of Chartered Certified Accountants (ACCA) has raised concerns over the UK Government’s planned changes to the anti-money laundering (AML) supervisory framework.
The accountancy body said that there are “significant weaknesses” in the model where AML compliance would move away from professional body supervisors, including the ACCA, to the Financial Conduct Authority (FCA).
Under the changes, the FCA act as the UK’s Single Professional Services Supervisor (SPSS).
The ACCA states that it will work to support the model the government prefers but argues that the change could increase exposure to economic crime.
It also links the proposal to potential negative effects on the accountancy sector’s development, noting the sector’s role in the government’s industrial strategy and wider economic plans.
A further concern raised is that higher costs and added administrative burden could lead some companies to discontinue membership of professional bodies.
The ACCA suggests that, even if practices remain subject to FCA AML supervision, reduced professional competence checks and weaker ethical and regulatory oversight could contribute to lower standards and greater risk of wrongdoing.
It also warns of possible misunderstandings among businesses and individuals about the FCA oversight for AML supervision.
The ACCA argues that the current system benefits from supervision carried out by organisations with detailed sector knowledge, which it describes as an important factor in deterring economic crime.
It says this capability would not transfer quickly and could take years for any new supervisor to build.
The ACCA is asking the government to engage with UK accountancy organisations to reduce uncertainty and prevent unclear areas in the proposals.
ACCA AML and Operations head Wesley Walsh said: “Under the SPSS model, ACCA firms will face the prospect of dual supervision and dual fees for AML supervision and their professional body.
“Also, the length of time it will take to implement a single AML supervisor could cause considerable disruption in supervision. In a challenging economic climate, these increased costs to businesses, large and small, cannot be justified.”
“ACCA raises concerns over FCA move for AML supervision” was originally created and published by The Accountant, a GlobalData owned brand.
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