To Serve and Survey: Lawyers and Auditors' Efforts To Reconcile Professional Commitments, Client Demands and Regulatory Requirements For Anti-Money Laundering

This paper studies how professionals serve as agents of public regulation. Following the trend for risk governance in various policy areas (e.g. Hood et al 2001), a distinguishing feature of anti-money laundering regulation is that risk management is a primary tool to combat crime. Transnational agreements and national law require various professional services providers to monitor client behavior and report indications of money laundering without informing the client(s) about these suspicions. In short, businesses must survey clients, even as they serve client needs.

Law and accounting are both professions with a history of explicit commercial engagement. However, auditors differ in that they constitute part of a legally-sanctioned compliance industry. Using an interview-based study, we probe 1) how lawyers and auditors articulate principle tensions between commercial demands, professional commitments and regulatory requirements, and 2) how these tensions are practically reconciled in everyday work.

We observe varying degrees of tension between professional autonomy, the role of client advisor/advocate and regulatory compliance. We also observe similarities in the formalization of client handling process as a structural means of making visible and actionable the balance between competing demands.

Theoretically, the paper draws on the emergent literature on multiple values in organizational work (e.g. Stark 2009). It contributes to a discussion of expectation gaps in the role of professionals and highlights wider practical implications for businesses of the dual discourses on transparency and risk (Bergström et al. 2011).

References

Bergström, M., K. Svedberg Helgesson and U. Mörth (2011) A New Role for For-Profit Actors? The Case of Anti-Money Laundering and Risk Management, Journal of Common Market Studies 49(5):1043-1064.

Hood, C., H. Rothstein and R. Baldwin (2001) The Government of Risk: Understanding Risk Regulation Regimes. Oxford: Oxford University Press.

Stark, D. (2009) The Sense of Dissonance. Princeton: Princeton University Press.