The Treasury has published its response to a 2016 consultation on the anti money laundering (AML) supervisory regime.

The Solicitors Regulation Authority (SRA) had used its submission to the consultation to call for the Treasury to impose "actual separation" rather than "putting in place safeguards" to ensure sufficient separation between regulation and representation in AML supervision. As signalled through earlier statements, the response confirms that the Treasury has rejected the SRA’s argument that it needs full separation from the Law Society to avoid interference in its operation of AML rules.
 
To provide increased oversight and more consistent and effective supervision, the government will introduce a new Office for Professional Body AML Supervision (the Office). The Office will focus its work on the accountancy and legal sectors, where multiple professional bodies work together to provide AML supervision.  The Office will work with professional bodies to develop high standards of supervision and hold them to account for their performance.

The Office will be hosted by the FCA. It will be funded through a new fee levied upon professional body supervisors on which the FCA will consult in due course. This obviously has implications for the Law Society.

The government is inviting views on the Office’s mandate and powers by 4 April 2017. The Law Society is pleased that the government’s response has recognised that there is no evidence to suggest professional body supervisors’ activities and decisions have been unduly influenced by their dual role as advocates for their members.