The New Legal Framework and the Role of Registered Auditors Against “Money Laundering” Fraud

This paper has assessed anti-money laun­dering requirements in light of the new EU Di­rective – the Fourth Anti-Money Laundering Di­rective, and the expected impact on registered Bulgarian auditors. The Directive was approved on 20/05/2015, and tightens the rules for EU Member States in terms of anti-money laun­dering and aligned them with the international framework. With the new framework, money laundering and terrorist financing countering is reaching new heights. Hence, the involvement and role of certain professional groups, includ­ing registered auditors expands and challenges their routine activities and professional practice. The analyses lead to the conclusion that, in terms of the legal framework, Bulgaria has transposed most of the EU-wide regulatory re­quirements in its national legal framework. Reg­istered auditors apply strictly the Law on Mea­sures against Money Laundering (LMML) and Law on Measures Against Financing of Terror­ism (LMMF). Certain ethic codes applicable to all registered auditors, members of Institute of Public Accountants, are in place – The Code of Ethics for Professional Accountants. Crucial role in the compliance process of the registered au­ditors and LMML and LMMF rules following play the Uniform Internal Rules for the Control and Prevention of Money Laundering and Terrorist Financing, developed by IPA. In regards to the new Fourth Directive, it has been transposed into the draft of LMML, which is expected to be in force by early 2018. The new legislative requirements (customer due diligence, risk assessment of money launder­ing, disclosure of suspicious transactions, and customers, etc.) will pose serious challenges for the sector. The general conclusion is that not all of the new proposed measures are easily appli­cable, objective and the expectations are for en­hanced administrative burden. It is necessary for texts to be more precise, additionally analyzed, in order to be even more effective and efficient and to take into consideration the specifics of external audit.