The UK's anti-money laundering regime, anchored in the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (commonly called "MLR 2017"), requires every business in scope to be supervised for AML purposes by an approved supervisor. For accountancy practices, the choice of supervisor — HMRC's Anti-Money Laundering Supervision (HMRC AMLS) or a professional body such as ICAEW — has material consequences for cost, scrutiny, and the wider service proposition.
Who supervises what
The MLR 2017 architecture divides supervisory responsibility across:
- Professional body supervisors such as ICAEW, ACCA, AAT, CIOT, ICAS, and the various law society bodies. These supervise their own member firms.
- HMRC AMLS, which supervises accountants and other businesses in scope (including estate agents, art market participants, high-value dealers and certain others) that are not supervised by a professional body.
- FCA for the financial services sector.
- Gambling Commission for certain gambling activities.
Why the choice matters for accountancy firms
An accountancy practice run by ICAEW members is supervised by ICAEW for AML purposes — ICAEW's Practice Assurance team conducts AML monitoring as part of its wider regulatory remit. A firm whose principals are not members of a professional body supervisor (or whose firm is not eligible for professional body supervision) must register with HMRC AMLS instead.
Practical differences include:
- Fees: HMRC AMLS charges premises fees and approval fees that can be significant for multi-office firms; professional body supervision is typically bundled into membership fees.
- Inspection style: ICAEW's combined Practice Assurance visit covers AML alongside audit, ethics, and quality; HMRC AMLS visits focus narrowly on AML controls.
- Approval of beneficial owners and senior managers: HMRC AMLS operates a "fit and proper" approval regime for all beneficial owners, officers and managers (BOOMs) of firms within its scope. ICAEW relies on its own membership and registration regime.
Core AML obligations regardless of supervisor
The substantive AML obligations on accountancy firms are identical across supervisors. Every practice must:
- Carry out a firm-wide risk assessment covering customer, product, geographic, and delivery channel risks. This must be documented, reviewed periodically, and approved at senior level.
- Maintain policies, controls and procedures proportionate to the risk assessment, covering customer due diligence (CDD), record-keeping, training, and reporting.
- Conduct CDD on every client, identifying the client and verifying that identity from reliable sources. For corporate clients, the beneficial ownership (typically those with more than 25% interest or otherwise exercising control) must also be identified.
- Apply enhanced due diligence for higher-risk relationships, including politically exposed persons (PEPs), clients in high-risk third countries, and complex or unusual transactions.
- Train all relevant staff and document the training.
- Appoint a Money Laundering Reporting Officer (MLRO) and a nominated officer for suspicious activity reports.
- Maintain records of CDD and transactions for at least five years.
Suspicious activity reporting
Where knowledge or suspicion of money laundering arises, the firm must submit a Suspicious Activity Report (SAR) to the National Crime Agency (NCA) via the SAR Online portal. The legal protection from "tipping off" the client is critical — once a SAR is being considered or has been submitted, the client must not be told. This area is unforgiving and most enforcement actions involve failures around SAR procedures.
Sanctions and enforcement
HMRC AMLS publishes enforcement actions quarterly. Penalties have included substantial six-figure fines for firms with weak risk assessments, missing or generic CDD files, untrained staff, or failures to register on time. Professional body supervisors also publish disciplinary outcomes. The trend over the last three years has been towards higher penalties and more public naming.
What clients should know
For clients of an accountancy practice, AML compliance is the reason your accountant asks for ID, proof of address, source of funds for unusual deposits, and details of beneficial ownership in your group. These requests are not red tape — they are statutory obligations on the practice, and a failure to comply could in principle lead to the practice declining to act. Cooperating early and providing high-quality documentation makes the onboarding process much smoother.
How we approach AML at PushDigits
As an ICAEW Chartered Accountancy firm, our AML supervision sits with ICAEW. We embed CDD and ongoing monitoring into client onboarding and into ongoing service delivery, including for annual accounts and director verification work. Our firm-wide risk assessment is reviewed annually and approved at partner level.
If you are setting up a new business and need to understand the AML implications of your structure, or if you are an accountancy practice in transition between supervisors, book a call or reach us via the contact page. We can provide an initial diagnostic of your existing controls.