The Treasury Committee has said that a more precise estimate of the scale of economic crime in the UK, while government should review the UK’s anti-money laundering (AML) supervision more frequently.

Furthermore, the committee argued that the UK should not compromise in the fight against economic crime to secure trade deals post-Brexit.

The Treasury Committee today published a unanimously-agreed report on economic crime and AML supervision, highlighted that the scale of economic crime in the UK is very uncertain, with estimates ranging from the tens of billions of pounds to the hundreds of billions. As result of this, the committee has urged government to provide a more precise estimate so that the response can be “tailored to the problem”.

Also, the Financial Action Task Force (FATF) has completed its review of the UK’s AML and counter-terrorist financing systems, over a decade since the previous full review.

“To maintain a ‘clean’ city, the government should institute a more frequent system of public review of the UK’s AML supervision and law enforcement that will ensure a constant stimulus to improvement and reform. This may be a role for the newly-announced Economic Crime Strategic Board, jointly chaired by the Chancellor of the Exchequer and the Home Secretary,” the committee said in a statement.

It continued, adding that the AML supervision system is “highly fragmented”. To reduce confusion and ensure consistency across all AML supervisors, the Treasury Committee suggested that government create a “supervisor of supervisors”, as the UK currently has 22 accountancy and level professional body AML authorities, with all being regulated by either HM Revenue & Customs (HMRC), the Financial Conduct Authority (FCA), the Gambling Association or the Office for Professional Body AML Supervision (OPBAS).

In relation to Brexit, the committee argued that it will provide both risks and opportunities in terms of economic crime.

“The increase in trade with non-EU counties will increase the likelihood that UK businesses will come into contact with markets with lower AML standards than the UK, but there will also be an opportunity for the UK to be a beacon in the world for the high standards to which we aspire.

“When conducting trade negotiations, the government must be clear about its intention to lead the fight against economic crime, and not compromise by shifting to a more buccaneering role in an effort to secure trade deals. The government must also ensure that the flow of information between the EU and UK’s enforcement agencies is retained or replicated post-Brexit,” it said.

Commenting, Treasury Committee chair Nicky Morgan said: “With the uncertainties of Brexit around the corner, the government should regularly review the UK’s effort to combat money laundering to ensure a constant stimulus to improve.

“When the UK does leave the EU, there will be both risks and opportunities in terms of economic crime. The government must ensure it does not bow to buccaneering deregulatory pressures and maintain its intentions to lead in the fight against economic crime.

“Leading that fight is going to require focus. The government needs to bring greater order to a fragmented supervisory system, better identify the scale of the problem, and make a greater effort to combat the known risks and gaps in the supervisory system.

“The committee’s comprehensive report makes a series of recommendations around estate agents, Companies House, financial sanctions and the UK’s corporate criminal liability framework that would help the UK combat economic crime.”

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