The FCA has imposed its first censure on a professional body, the Institute of Certified Bookkeepers (ICB), for failings in relation to its anti-money laundering supervision.

It’s the first first time the regulator has publicly censured a professional body supervisory organisation. 

Many of the issues occurred when the ICB suspended inspections for a nine month period in 2022 and 2023.

The censure is limited to the publication of a final notice and no fine will be levied.

The ICB is one of twenty-five PBSs (Professional Body Supervisors) in the legal and accountancy sectors that are supervised by the Office for Professional Body Anti-Money Laundering Supervision (“OPBAS”), part of the FCA.

The watchdog said it had censured the High Wycombe-based Institute of Certified Bookkeepers (ICB) for “serious deficiencies” in its anti-money laundering (AML) supervision.

The not-for-profit organisation holds professional body supervisor status and is responsible for overseeing the AML compliance of over 3,000 bookkeepers under the Money Laundering Regulations 2017.

Between January 2022 and July 2023, the body, breached key AML regulations relating to its role as an AML supervisor. According to the FCA this failure increased “the risks of financial crime amongst members.”

The ICB failed to adopt, “an adequate risk-based approach” to its supervisory functions and did not effectively monitor its members.

The most serious breaches were caused or made worse by ICB’s decision to suspend all inspections - both onsite and virtual - for nine months. During this period, the ICB’s ability to scrutinise members’ compliance with AML regulations was “seriously undermined,” the FCA said. The failings exposed the sector to greater money laundering risks, according to the FCA.

Therese Chambers, joint executive director of enforcement and market oversight at the FCA, said: “'Anti-money laundering rules stop criminals from exploiting the financial system and help protect people, businesses and wider market trust. Strong AML supervision matters because it ensures these safeguards work in practice.

“This outcome demonstrates that the FCA is prepared to take enforcement action against professional body supervisors where their oversight of member organisations falls below the high standards we expect."
 
Recently the Government announced planned reforms to the FCA’s Single Professional Services Supervisor rules, aiming to deliver a more effective approach to combatting illicit finance. In the interim, OPBAS will continue to work with professional body supervisors to ensure compliance with AML regulations.