Campaign Against Money Launderers Leads to 20% Drop in Fines

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The number of fines handed out for money laundering and terrorist financing rule breaches has fallen 20% in the last year as tougher enforcement delivers a wake-up call, anti-money laundering and Big Data specialist Fortytwo Data reveals.

It follows record enforcement in 2015/16 when 1,170 professionals – including lawyers, accountants and those in the gambling industry – were fined for failures. A further 45 were reprimanded and ten suspended.

By 2016/17 sanctions fell to 935 fines (a 20% drop), 31 reprimands (31% down) and eight suspensions (down 20%), according to figures released in a new report by HM Treasury.

In the same period, the number of action plans handed down plummeted 57% from 1,371 to 593, reprimands dropped 31% to 31 and warning fells 4.7% to 325.

Meanwhile the accounting sector has saw 23 accountants expelled in 2016/17 (up 77% on 2014/15). The profession also witnessed a 150% rise in the number of fines in a single year, up from 14 to 35 in 2016/17.

The figures are contained in the Treasury’s sixth ‘Anti-Money Laundering and Terrorist Financing: Supervision Report 2015-17’.

It was compiled using data from the 25 UK Anti-Money Laundering and Combating the Financing of Terrorism supervisors, which includes the Financial Conduct Authority, HMRC and the Gambling Commission, as well as 22 legal and accountancy Professional Body Supervisors (PBSs).

At least £90bn in criminal proceeds is believed to be laundered in the UK annually, according to the National Crime Agency.

The Treasury report also reveals the UK accounted for more than 40% of all of Europe’s Suspicious Activity Reports (SARs) in the legal and accountancy sectors.

SARs are alerts submitted to the National Crime Agency that flag up suspicious activity indicative of money laundering.

Table 1: Enforcement action imposed by the 25 AML/CFT supervisors and 22 legal bodies

Enforcement action Number of actions taken 2014/15 Number of actions taken 2015/16 Number of actions taken 2016/17
Suspension 2 10 8
Fine 724 1,170 935
Reprimand   57 45 31
Undertaking /

condition

72 16 74
Warning 498 341 325
Action plan 999 1,371 593

Table 2: Enforcement in the accountancy sector

Enforcement action Number of actions taken 2014/15 Number of actions taken 2015/16 Number of actions taken 2016/17
Expulsion / withdrawal of membership 13 19 23
Suspension 1 2 3
Fine 33 14 35
Reprimand 51 41 28
Undertaking / condition 44 13 70
Warning 298 238 205
Action plan 483 670 582

Julian Dixon, CEO of specialist Anti-Money Laundering (AML) and Big Data firm Fortytwo Data, comments: “Any professional tempted to help criminals launder their ill-gotten millions could not have escaped the huge amount of publicity levelled at professionals over the last few years.

“And this campaign appears to be working but the authorities have got to keep the pressure on because these professions are targeted precisely because of their perceived respectability.

“The spike in expulsions of accountants over the past two years shows why there is no room for complacency.”

(Source: FortyTwo data)

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