Software supporting AML compliance

Tom Herbert of the AccountingWEB recently posted an article discussing the options that practitioners face when selecting and using software to fullfil their AML regulatory obligations.

As our director, David Winch, pointed out:

“Each accountancy firm is unique – not least because the partners in it have unique experience, knowledge and interests,” said Winch. “In my opinion, each firm’s AML compliance also needs to be unique.”

In which case, whichever software product you decide to use, it is one aspect of your compliance systems and must be viewed in that way.

Many of the products marketed are used to check identity and residence, basically a support for onboarding, but regulators will also want to see an updated Firm-Wide Risk Assessment, a similarly updated Policy & Procedure Manual and evidence of an annual review of client risk.

There is a temptation to feel that software deals with AML compliance, full stop. Unfortunately, regulators will want to see that your practice has created and is using an approach to compliance that is more than box ticking.

In the above mentioned AccountingWEB article, David Winch further commented:

“The danger of a ‘package’ is that it is adopted uncritically and is not sufficiently tailored to the firm’s unique profile… Bear in mind too that the AML regulator will have seen the package before and will readily recognise if the firm has simply adopted a package in an unthinking way.”

Another potential problem with a package solution highlighted by David is that if it generates high/medium/low-risk ratings based on yes/no answers to standard questions, the MLRO may not be in a position to explain and justify those risk ratings if challenged by regulators.  

“Risk ratings produced in that way do not use the knowledge and experience of the practitioner – but surely they should.”

Read more…

Read the AccountingWEB post here together with readers comments

We can help

If your firm has received notice of an AML compliance visit, would like to ensure that its’ AML systems are up to scratch or respond to a negative report from their regulator, we can help. Take a look at the AML support services we offer. We can also help in the selection of an online AML training solution and discuss other onboarding software options.

David Winch MLRO support services ltd