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ACCA Applied Skills · Corporate and Business Law (Global) · Fraudulent and criminal behaviour

A company's accountant discovers that a customer has deposited large sums of cash that appear to come from illegal activity, and the customer then asks that the money be passed through the company's accounts to a third party. What should the accountant primarily do under typical anti-money laundering rules?

The accountant should report the suspicion through the proper internal or regulatory channel without tipping off the customer. Anti-money laundering rules require reporting, tipping off is an offence, and confidentiality does not override that duty. Processing the funds could itself amount to laundering.

  1. AReport the suspicion through the proper internal or regulatory channel, without tipping off the customerCorrect
  2. BWarn the customer that the transactions may be investigated
  3. CProcess the transactions and keep the concern private to protect client confidentiality

Explanation

Anti-money laundering rules require suspicions to be reported to the nominated officer or authority. Tipping off the customer is an offence, and confidentiality does not override the duty to report. Processing the funds could itself be laundering.

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