51% of our supervised firms offer trust or company services to clients and are small or medium sized practices. We monitor our supervised population and take measures where necessary to ensure compliance.
The National Risk Assessment (2020) has highlighted trust and company service providers (TCSPs) are at a higher risk of being used by criminals to facilitate money laundering.
Our supervised firms are required by law to:
perform a firm-wide risk assessment of the money laundering risks within their firm and
perform Customer Due Diligence (CDD) on each client to assess the risks of that client using the firm to facilitate money laundering.
We undertook a thematic review to assess the nature of the TCSP services offered by the firms we supervise and to explore the risk that these services may be used to facilitate money laundering.
We surveyed a sample of firms about the TCSP services they provide and whether those services are in conjunction with accountancy services. We also asked them to describe their assessment of the risks that TCSP services present, how they adapt their procedures to mitigate those risks and the number of Suspicious Activity Reports (SARs) they had submitted.
We selected firms with a range of risk profiles considering factors such as the client base and services they provide. The factors are linked to the National Risk Assessment, which defines higher risk services and client typologies. All the firms selected provide TCSP services.
The findings show that all the firms surveyed consider and assess the risk of providing TCSP services as lower when offered to existing clients with a clear business rationale for the service.
Most firms are clear that they do not offer registered office and/or company formation services without a business rationale and an ongoing service provision, that includes other accountancy services.
We grouped our findings into the following key categories:
This report sets out some of the qualitative and quantitative data and trends we observed from the responses to questionnaires we sent to firms offering TCSP services.
We have included a commentary on the responses, as well as our observations on what our firms are doing well and what can be improved.
The report outlines the outcomes of a thematic review undertaken on AIA supervised firms which provide Trust or Company Services to their current or prospective clients.