Payroll and modern slavery and human trafficking – red flags

In March 2020, the NCA published modern slavery and human trafficking indicators. The report provides red flag indicators to be aware of during payroll engagements.

The risks are highest where:

• Staff have not received AML training tailored to payroll services,
• Staff are not client-facing or
• The client provides poor quality information.

https://www.nationalcrimeagency.gov.uk/who-we-are/publications/434-indicators-of-msht-in-the-accountancy-sector/file

Modern Slavery and Human Trafficking (MSHT) is a significant threat to the UK and brings horrendous harm to its many victims, from both the UK and abroad.

A case study presented at the end of this document outlines the different types of harm that can be endured through a series of victim stories and explores how businesses can be infiltrated by MSHT organised crime groups (OCGs).

The accountancy sector and its clients are just one area that may be unwittingly involved in this crime.

The UK Financial Intelligence Unit (UKFIU) has issued the document in collaboration with the Modern Slavery and Human Trafficking Unit on behalf of the National Crime Agency.

And this version was constructed following consultation with:

• The Accountancy Affinity Group,
• Accountancy Suspicious Activity Report (SAR) Working Group and
• Other SAR anti-money laundering (AML) specialists.

It will set out some high-risk accountancy type services relating to MSHT and outline red flag indicators which are intended to raise awareness and recognition of MSHT for those working in the accountancy sector. It is recommended that this document be used to complement any existing knowledge and general awareness of indicators of suspicious activity.

Please note: These indicators should not be treated in isolation, and it is often a combination of factors that strengthen suspicion assessments.