The interaction between accountants and bankers within AML : a qualitative study

Abstract

Purpose: In recent years, money laundering breaches have dramatically increased, resulting to a corresponding surge in regulation and preventative measures to address such breaches. As a result, both the accountancy and banking industries have been heavily impacted around the world. This study aims to analyse the relationship and its extent, between the accounting and banking professions with respect to anti-money laundering. Accountants and bankers need the cooperation and professionalism of each other to conduct a satisfactory service to their respective common clients. Design: A qualitative stance to research was adopted focusing on allowing the data to emerge rather than to force it. The data is collected through semi-structured interviews with a total of thirteen participants. These include five accounting professionals, four banking professionals, two money laundering reporting officers (one from each profession) and two professionals working within a local regulating authority. Findings: The study concludes that the accounting and banking professions interact on a client-oriented level, facilitating due diligence. With respect to anti-money laundering, no relationship between professions is currently present, stemming from the dilemma of tippingoff. Anti-money laundering is constantly developing, to mitigate criminal activity. This may have led to a culture shift, leaving sole practitioners and mid-tier firms behind, especially in the context of accounting firms. It is evident that the bankers were required to be compliant towards anti-money laundering for a significantly longer duration than accountants, with the former being significantly ahead of the latter. This is also evident in the suspicion reporting culture embedded within both professions. Conclusion: The accounting profession still has a long way to go to implement an antimoney laundering compliance culture, and likewise to raise suspicious transaction reports of similar nature to that of the banking profession. Education and training initiatives are the way forward to constantly improve and to keep abreast with the constant changes in the anti-money laundering space. A forum between the two professionals would drive and improve the professions and ultimately benefit the local financial community. Value: Money laundering is a serious issue in today’s world. Subject persons, including the banking and accounting professionals are to do their utmost to ensure that through their services they preserve the integrity of the financial market. This study highlights the participants’ insights and their individual anti-money laundering procedures. Suspicious transaction reports are an integral part to the ultimate scope of anti-money laundering. This study provides insights from procedures adopted by both professions when encountering a suspicion, whilst highlighting the differences and hindrances encountered.