Sense and sensibility – practitioners at work

AML - a senior management role

Before the Financial Services Authority’s recent Handbook changes - removal of the Money Laundering Sourcebook and the new requirement to appoint a senior manager with responsibility for AML – it was clear that the (dirty) buck stopped with the MLRO. Now though, life is potentially more complex David Blackmore, consultant with MHA and a former MLRO, noted during a workshop at the Third Annual Institute of Money Laundering Prevention Officers Conference in Manchester recently. “The MLRO can be the senior manager and may be the nominated officer [who makes suspicious activity reports to the Financial Intelligence Unit].” While one person is likely to be a jack of all trades in smaller institutions, “in larger houses, decisions will need to be made,” said Blackmore. In most large organisations, the Controlled Function 11 - the MLRO designation under FSA rules - was previously held by someone two steps away from the Board, a delegate from Aviva, the UK insurer, observed. A senior manager is either on the Board or one step below, he added, “In our organisation responsibility for anti-money laundering has been raised to someone one step below Board level accordingly.” He favoured the change and recommended MLROs to put their annual report before the Audit Committee for sign-off since it makes it more difficult for senior management to discount.