David Winch's Money Laundering Manual for Accountancy Firms
(Extract Index and section 2 only)
1: Index
2: User Guide
3: Overview
4: The 'regulated sector'
5: Registration and supervision
6: Risk Assessment and Management
7: Customer Due Diligence
8: Ongoing Monitoring of clients
9: Reporting
10: Offences and Penalties
11: Practice Internal Controls
12: Training
13: Record Keeping
14: Monitoring of the firm's compliance
15: Other Resources for the MLRO
16: Toolkit
17: Disclaimer and copyright
18: Update Log
19: Feedback
2: User Guide
2.1: Why do you need this manual?
The Money Laundering Regulations 2007 have imposed new burdens on accountants in practice and introduced new supervision arrangements by professional bodies and by HM Revenue and Customs.
You may be facing a situation in which your firm has as yet put no procedures in place to comply with the regulations, or you may be reviewing and updating your procedures in the light of the new regulations. In either case this manual and the accompanying toolkit will be invaluable to you in that process.
This manual and toolkit have been prepared with the MLRO in a typical general practice accountancy firm, either a sole practitioner or a partnership of up to 5 partners, in mind.
The focus has been on the important components of a firm's compliance with the anti-money laundering and anti-terrorist financing legislation in the United Kingdom for such a firm. It is not, however, intended to cover every issue which might arise for such a firm.
This manual and toolkit therefore do not replace the anti-money laundering guidance for the accountancy sector which has been produced by the Consultative Committee of Accountancy Bodies (the CCAB) and approved by HM Treasury which can be accessed on the internet at this address.
In addition, where reference material can conveniently be found in the CCAB guidance, for example specifying documents which may be accepted for the purpose of verifying the identity of a client, reference will be made to the CCAB guidance in this manual to avoid mere repetition of that CCAB material.
HM Revenue and Customs have indicated that accountancy firms subject to their supervision should follow the CCAB anti-money laundering guidance in the same way as accountancy firms supervised by a professional body which is a member of the CCAB.
Also, because this manual and the accompanying toolkit is designed for accountancy firms in general practice, it does not deal with issues that relate specifically to, for example, insolvency business, which is not carried out by the majority of general practice accountancy firms.
2.2: How to use this manual
This product is intended to be more than a reference manual.
As well as including a considerable amount of reference material dealing with the detailed requirements of the regulations it also includes a toolkit which is intended to assist and guide you through the actions required in setting up the necessary procedures in your firm and in maintaining them.
2.2.1: Your firm's manual
Each accountancy firm is unique because of the range of services which it offers and the variety of its clients.
It is likely that your firm has already developed methods of working and its own procedures for preparing working papers, handling clients' records, accepting new clients, and so on.
The Money Laundering Regulations require the firm to adopt a risk-based approach to anti-money laundering and anti-terrorist financing procedures.
For all these reasons it would not be appropriate, in our view, to attempt to produce a ready-made manual which could be adopted, without modification, by a wide range of different accountancy firms.
Instead this manual is aimed at assisting accountancy practices to develop their own anti-money laundering and anti-terrorist financing policies and procedures, which should be recorded and implemented by the firm as appropriate. The Money Laundering Regulations 2007 specifically require your firm to "establish and maintain appropriate and risk-sensitive policies and procedures relating to—
(a) customer due diligence measures and ongoing monitoring;
(b) reporting;
(c) record-keeping;
(d) internal control;
(e) risk assessment and management;
(f) the monitoring and management of compliance with, and the internal communication of, such policies and procedures, in order to prevent activities related to money laundering and terrorist financing".
In our view those practices should be designed by the firm to integrate with its existing procedures in relation to, for example, new client procedures.
This manual and toolkit should provide invaluable assistance to the firm in designing and implementing policies and procedures which comply with the relevant legislation. The policies and procedures adopted by the firm should, for obvious reasons, be recorded - possibly in the form of a separate money laundering procedures manual but alternatively by inclusion within the firm's documentation of other, more wide-ranging, policies and procedures.
2.2.2: Using the toolkit
Accompanying this manual you will find a toolkit which will assist you in, and guide you through, the major components of setting up and maintaining your firm's compliance with the Money Laundering Regulations.
You can use this to identify and implement the actions required to deal with any weaknesses in your firm's anti-money laundering procedures.
We see the toolkit as providing recipes for action and as perhaps the most useful component of this manual.
2.2.3: As a reference guide
In addition to the toolkit, this manual contains reference material dealing with the key elements of compliance with the Money Laundering Regulations.
2.3: Updates
The manual will be updated when necessary. It reflects the Money Laundering Regulations 2007 and the CCAB guidance based on those regulations which has been approved by HM Treasury.
The manual was last updated in February 2009. A full Update Log can be found within the manual.