RegTech provider SmartSearch has warned that anti-money laundering (AML) standards must improve across the legal and accountancy sectors following the publication of a new report from the Office for Professional Body Anti-Money Laundering Supervision (OPBAS).
The findings indicate that while oversight of money laundering risks has strengthened in recent years, significant gaps in enforcement and compliance remain. The report assesses how professional body supervisors monitor firms under the UK’s Money Laundering Regulations and highlights persistent shortcomings that could leave the financial system exposed to illicit activity.
According to the OPBAS review, professional body supervisors are now operating more effectively than when the organisation was first established in 2018. Despite this progress, the watchdog noted that weaknesses remain across many firms, particularly around compliance procedures and risk management practices.
The report arrives at a time when regulators are intensifying enforcement efforts. Between April and September 2025, HMRC issued 336 penalty notices related to breaches of the Money Laundering Regulations, with fines reaching up to £104,000.
Commenting on the findings, SmartSearch CEO Phil Cotter said the report highlights the ongoing challenge regulators face in ensuring consistent AML standards across professional services firms.
Cotter said, “The OPBAS 2024/25 report delivers a stark message: baseline AML compliance in legal and accountancy sectors is adequate, but effectiveness remains inconsistent, and some poor practice persists.”
He pointed to the recent enforcement data as evidence that compliance gaps remain widespread across the sector.
Cotter went on, “The enforcement figures tell the story. HMRC issued 336 penalty notices between April and September 2025 for Money Laundering Regulations breaches, with fines reaching as high as £104,000. The majority were for failure to register properly, but 33 penalties were issued for substantive failures, inadequate risk assessments, missing AML controls, insufficient staff training, and deficient customer due diligence.”
The OPBAS report also identified several areas where professional body supervisors continue to encounter recurring compliance failures among firms they oversee.
“More concerning is OPBAS’s finding that Professional Body Supervisors still report ‘common breaches of inadequately documented policies and procedures, customer due diligence, client risk assessment or records and no or inadequate firm-wide risk assessment’ among their supervised populations. These aren’t new issues; they’re persistent failures that call into question whether firms are truly taking their obligations seriously,” remarked the CEO.
Cotter added that the report highlights structural challenges within the supervisory framework, including inconsistent enforcement approaches and reliance on manual processes across thousands of firms.
He continued, “The report identifies several critical gaps: some PBSs take an ‘overly member-centric’ approach that hinders robust supervision; enforcement remains weak with firms receiving multiple chances to remediate before facing consequences; and manual, inconsistent processes struggle to achieve the coverage needed across 41,400 supervised firms.”
The regulatory landscape may soon change significantly, with plans for the Financial Conduct Authority to take on the role of single AML supervisor for professional services. Cotter believes this shift will raise expectations for firms and increase the need for stronger compliance infrastructure.
“With the FCA set to become the single AML supervisor for professional services, the bar will rise. Technology is essential to closing these gaps—not as a ‘nice to have,’ but as the only viable way to achieve consistent, effective compliance at scale,” said Cotter.
SmartSearch argues that automated compliance tools are becoming increasingly important as firms seek to meet growing regulatory expectations. Technologies such as digital identity verification, sanctions screening and continuous monitoring can help firms manage AML obligations more efficiently while reducing the risk of human error.
Cotter highlighted, “SmartSearch provides the automated identity verification, beneficial ownership identification, real-time sanctions screening, and ongoing monitoring that professional services firms need. Our platform turns compliance from a manual, error-prone burden into an efficient, audit-ready process.”
Cotter concluded that relying on manual or partially assisted compliance processes will no longer be sufficient as regulatory scrutiny intensifies “The message is clear: assisted compliance and manual processes won’t cut it anymore. Firms need robust, technology-enabled AML systems, before the FCA takes over supervision and expectations increase further.”
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