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ACCA Applied Knowledge · Business and Technology · Regulation and financial crime

An accountancy firm's money laundering reporting officer (MLRO) receives an internal report from a junior employee who suspects that a client is laundering money. What is the MLRO's main responsibility?

The MLRO's main responsibility is to receive and evaluate internal suspicion reports and decide whether to submit a suspicious activity report to the national authority. The MLRO must not alert the client, because doing so could be the offence of tipping off.

  1. ATo confront the client directly and ask whether the funds are of criminal origin
  2. BTo evaluate the internal report and decide whether a suspicious activity report must be made to the national authorityCorrect
  3. CTo freeze the client's bank accounts until the suspicion is resolved
  4. DTo inform the client that a report is being made so that they can explain the transactions

Explanation

The MLRO is the firm's nominated point of contact for internal suspicion reports. The MLRO assesses them and decides whether to file a suspicious activity report with the national authority. Telling the client could amount to the offence of tipping off, so option D is wrong.

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