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Last updated: 26 May 2022 02:00 Posted in: Anti-money laundering

Thematic Review

The United Kingdom National Risk Assessment (2020) highlighted trust and company service providers (TCSPs) as being at a higher risk of exploitation by criminals to facilitate money laundering.

The Association of International Accountants (AIA) is a professional body supervisor for accountants in the United Kingdom under Schedule 1 of the Money Laundering Regulations 2017 (MLR). In the Republic of Ireland AIA acts as a Designated Accountancy Body under the Criminal Justice (Money Laundering and Terrorist Financing) Act.

51% of AIA’s total population of supervised firms currently offer trust and company services to clients.

In Spring 2022 we undertook a thematic review to assess the nature of the trust and company services offered by the firms we supervise and to explore the risk that these services may be used to facilitate money laundering.

The report sets out a selection of the qualitative and quantitative data and trends we observed from the responses to questionnaires we sent to firms offering TCSP services.

The findings show that all the firms we surveyed consider and assess the risk of providing TCSP services as lower when provided to existing clients with a clear business rationale expressed for the service.

The thematic review highlighted examples of good practice and recommended improvements over several key areas:

  • Firm-wide procedures
  • Customer due diligence
  • Risk factors
  • Enhanced due diligence
  • Suspicious activity reporting
  • Training

The report also noted how the results of the thematic review have impacted AIA’s monitoring and supervision strategy.

AIA Director of Operations and MLRO David Potts said, "We monitor our supervised population and take measures where necessary to ensure compliance. Understanding the underlying risk factors within our supervised population means we can better educate our firms to identify, mitigate and avoid these risks and protect themselves from unwittingly aiding economic crime. The new guidance released by AIA today is another key tool for our supervised firms."


New Guidance for Members

We expect firms providing higher risk services to recognise the risks, have a documented firm-wide risk assessment, strong verification procedures and robust procedures for monitoring ongoing relationships with clients.

This new guidance has been specially formulated for AIA Members in Practice offering Trust or Company Service work and is influenced by the outcome of AIA's 2022 TCSP Thematic Review.