Publication Date03 May 2016
AuthorBarry Rider
SubjectAccounting & Finance,Financial risk/company failure,Financial crime
Looking at the tea leaves!
How good we are in Britain at risk assessment is a moot point. Perhaps the most
accurate assessment is that we are quite good at it – or at least not materially worse than
most other developed societies, but not particularly good about doing anything about it!
The Treasury and Home Ofce’s rst published risk assessment on money laundering
and terrorist nance was released last October and makes interesting (and disturbing)
reading. Of course, many other countries have long published risk assessments relating
to such issues albeit in the main not as a separate exercise from a more general strategic
assessment. In practice, these tend to reect the historic allocation of resources within
government than any sensible predictive analysis of the future. At best one can discern
trends – and given the way government and, in particular, quasi-law enforcement
agencies work, these have usually long achieved the status of a fait accompli! The UK
assessment reects the risk of intelligence (we are perhaps being generously
complimentary!) being a reection of already determined priorities.
The penetration of the high-end property market by those with questionable wealth
has long been recognised, and not just on the basis of anecdotes. Thirty years ago, the
then National Drug Intelligence and Investigation Unit (NDIIU) identied this as a risk!
MI5 took an interest in at least certain aspects of this 20 years ago, and H.M. Revenue
and Customs (HMRC) have had programmes (again we might be being generous!) ten
years ago! In fact, the Commonwealth Commercial Crime Unit raised this as an issue in
terms of the proceeds of sovereign looting in 1981! The concern that professionals –
whether lawyers, accountants, estate agents and bankers – facilitate the placement of all
this suspect dosh goes back somewhat further in time. Indeed, there are a plethora of
reported civil cases in the 1970s and 1980s which manifestly throw up the reality of
“high end facilitation”. Indeed, John Moscow, the lead prosecutor in New York of the
Bank of Commerce and Credit International Ltd. (BCCI) crooks, at the annual
symposium on economic crime in Cambridge in 1994, raised just this issue. More
recently, the Economic Crime Command of the National Crime Agency (NCA) has
rightly decided to focus attention on all this, but at a time when the Government has,
again for sensible albeit perhaps not very ethical reasons, decided to go a little more
softly in its dealings with the City and its “professional” foot soldiers. Consequently, it
remains to be seen whether Mr Donald Toon, who heads the NCA in this regard, is going
to achieve more than that somewhat nebulous goal of disruption rather than banging up
a few magic circle partners. Whether giving the NCA some “direction” over the Serious
Fraud Ofce for England and Wales (SFO), albeit only in regard to corruption, will make
any difference – except to those concerned with constitutionality – also remains to be
The Law Society and the Institute of Chartered Accountants rushed to address the
perceived threat of professionals facilitating money laundering by criticising the
Treasury and Home Ofce’s assessments on the basis that they have not been properly
researched and are based on perceptions and anecdotes rather than real intelligence. The
view that the City of London itself remains at risk is perhaps less easy to contest. The
NCA has itself expressed concern as to the way in which the suspicion-based reporting
system is working, or perhaps not working. Senior ofcers have expressed the view that
Journalof Financial Crime
Vol.23 No. 2, 2016
©Emerald Group Publishing Limited
DOI 10.1108/JFC-03-2016-0018

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