Accountants seek clarification on law

ACCOUNTANTS have sought clarification from the Department of Justice regarding the implementation of tough anti-money laundering rules.

Under the regulations, which came into force yesterday, members of 10 specified professions who fail to report a suspicious activity involving money could face unlimited fines and even custodial sentences.

Certified accountants say the regulations were so broad that they oblige them to report suspected crime where the proceeds are as little as 15. “Our legal advice suggests that even the most trivial offence is caught and that proceeds of suspected indictable offences as low as 15 must be reported,” said Aidan Lambe of the Institute of Chartered Accountants in Ireland.

Mr Lambe, the ICAI’s deputy director of quality assurance, said this would result in a vast volume of reports. “There are thousands of indictable offences in Irish criminal law. Accountants and auditors will have to report any offence, no matter how minor.

“There will be potentially huge volumes of reports to be processed by gardaí and Revenue. It will end up clogging up the system.”

Mr Lambe said there were an estimated 2,500 accountancy practices in the country who were members of professional bodies, as well as accountants who are not members.

The money laundering regulations also cover nine other designated bodies including tax advisers, auctioneers, estate agents, auditors, solicitors and investment business firms.

Dealers in high value goods, such as precious stones, precious metals and works of art, who are paid in cash for an amount equal to or above €15,000 must also report. Administration companies providing services to collective investment schemes and providers of money remittance services are also included.

Justice Minister Michael McDowell announced the introduction of the regulations last June following an EU directive. Solicitors, accountants, auditors and tax advisers who are advising or representing clients in relation to court proceedings are exempt from the law.

Mr Lambe said they had issued guidelines to members advising them of the law, pending clarification from the Department of Justice. He said the ICAI would like to see a monetary threshold, limiting reporting obligations to major crimes.

A spokeswoman for the Department of Justice said officials were in consultations with the National Consultative Committee of Accountancy Bodies in Ireland.

She said the Department was in the process of drafting further regulations to clarify the matter.