CHARTERED accountants in Scotland are helping criminal gangs launder money and commit fraud, the sector's main professional body admitted last night.
Leaders of the 15,000-strong Institute of Chartered Accountants of Scotland (Icas) said ''a minority'' of members were engaged in illegal practices but conceded the problem had become so large neither the professional body, nor police fraud squads were able to stop them, unless they were given new powers.
Dr Tom McMorrow, the institute's head of legal services, said: ''The amount of illicit money slushing around the west of Scotland in particular at the moment is enormous - and it comes from many sources, including drug and human trafficking.''
Scotland has become a popular destination for human trafficking, with Shetland targeted by criminal gangs for landing illegal immigrants through a number of routes from Scandinavia, Russia, and Europe.
Icas declined to give examples, but it is known that one of its members has been found guilty of deliberately bankrupting a limited company and fraudulently transferring its assets to a ''phoenix''company, leaving the creditors of the first company, which include the taxman, ''high and dry''. The member is appealing against the finding within Icas's disciplinary structure.
Dr McMorrow said Icas wanted the government to give it new statutory powers, both to obtain evidence from non-members - who may be criminals with whom an accountant has colluded - and also to force them to testify in hearings.
He said: ''The evidence necessary to catch an errant member will probably be in the hands of someone who isn't a member. We receive minimal co-operation from someone like that, because they may be involved in the same plan as the accountant.''
There is concern about the effectiveness of the government's clampdown on money laundering, enshrined in the proceeds of crime act 2002.
Icas voiced its own fears in a letter last week to John McFall, chairman of the Commons Treasury select committee, and two submissions to the Department of Trade and Industry, copies of which have been passed to The Herald.
It told Mr McFall: ''We believe the professions must come to terms with the more sophisticated means of concealing illicit monies that organised criminals are now employing.
''There are two kinds of money laundering: first, where large tranches of stolen funds are deposited in a professional firm's bank account for instant dispersal to those in the criminal ring, and secondly, where the professional firm lends assistance to the ring, not merely in the distribution of cash but in the perpetration of the fraud in the first place.''
Dr McMorrow said: ''A minority of (Icas) membership is prepared to provide lucrative services to those engaged actively in the black economy and all that expression has come to (mean) in these modern times.
''It is no coincidence that two of the principal focuses of the National Criminal Intelligence Service and the Act are white-collar crime, and the participation of accountants and lawyers at all levels of nefarious activity.''
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article