Money Laundering Reporting Officers (MRLOS) play a crucial role in protecting a firm from financial and reputational risks. They apply their knowledge of advanced money laundering schemes, updates to laws, and codes of conduct daily, analyse large amounts of data for firms, and ensure companies comply with AML rules.
Their contribution is invaluable for firms, protecting them from money laundering risks and often playing a crucial part in the onboarding experience of new clients. While MLRO’s and their responsibilities are a legal requirement , at Firmcheck, we often hear frustrations from MRLOs about their role being overlooked and underappreciated.
As an extension of our MRLO Summit in February, today uncover with us the main reasons why their role is overlooked, and if you’re an MRLO how you can communicate your value to a firm.
The Role of an MRLO
An Anti-Money Laundering Officer is responsible for implementing and enforcing a firm's risk-based approach. In general, they must comply with Anti-Money Laundering (AML) regulations and report any suspicious activity related to money laundering or terrorist financing to the National Crime Agency.
You can think of their 'role' as a set of jobs or responsibilities, e.g., managing client onboarding and the associated mental burden. The role of an MRLO can vary based on each firm's structure, some have dedicated roles and teams while others take the responsibilities of being an MLRO alongside other work.
Regardless of a firm's structure, the responsibilities of an MRLO are the same:
- Regulatory compliance
- SARs
- Policies and procedures writing and management
- Firm training
- Internal monitoring and audits
- Liaison with regulatory bodies
- Risk management
The problem?
The responsibilities of the MLRO are often seen as hindrances to money making activities within the firm. The checks and balances that MLROs need to tick with potential clients before the client has even commenced work means there is a time and money outlay that the MLRO asks for, and often barriers and delays to client onboarding. They’re often seen as getting in the way of the real work which is a mindset that can get firms in a lot of trouble.
Not all of these responsibilities are thought about or met until the last minute. MRLOs aren't always valued. Often, if the MRLO is involved in other business activities or there's a scarcity of time or resources in a firm to focus on existing and new AML laws, they're often seen as a low priority. It's not until a crisis occurs, like a compliance breach or regulatory action, that an MRLO is needed.
How to navigate the firm's leadership team also to get them to value AML compliance?
Those in leadership roles need to understand the benefits of activities, the costs, and the payoff.
For a function that gets in the way of 'real work' how can you highlight AML benefits to leaders within a firm, so they understand the importance of an MRLO?
By speaking their language.
Finding out what's in it for them and communicating the benefits the firm will gain, for example:
- Establishing trust with high-value clients and regulators
- Risk mitigation against fines and personal liabilities
- Protecting the firm's ability to operate
- Improves the firm's operational efficiency
- Less reactive and more proactive strategy
- Stronger internal processes
Pro Tip: Frame AML as a firm strategy to leverage additional value within the firm.
Do MLROs add value (money) to a firm?
To persuade firms, you must know the value that you, as an MRLO, can add. MRLOs can help establish a:
Efficient onboarding process
During the Customer Due Diligence (CDD) process, MRLOs can identify potential clients who may be challenging to work with. By doing so, they can save a firm valuable time and provide crucial insights to make informed decisions about who to onboard.
Efficient onboarding = More money for the firm and greater capacity to acquire more clients.
Positive onboarding experience
Due to the CDD, MRLOs (and others performing a similar role) are the main firm members who have strong knowledge and understanding of client identities and the services they use. By leveraging their knowledge, they can act as a voice for clients, creating a positive onboarding experience that welcomes them to the firm.
Moreover, MRLOs can provide valuable insights into additional services clients require, helping them establish effective communication channels to upsell and uncover opportunities for upselling.
Better understanding of client behaviour
Through the annual review process, MRLOs can better understand the client's relationship to the firm.
For example, is the client showing indicators that they'll likely be offboard?
Valuable insights like this from annual returns can help provide greater insight into issues, business opportunities, or requirements and strengthen connections with them.
Annual reviews can provide greater insights into business opportunities, such as whether there are clients in certain cities (business expansion) or those who require certain services or ask specific questions (tailored solutions).
By leveraging these insights, as an MRLO, you can drive growth, improve client satisfaction, and solidify the firm's position in the market.
Creating a robust AML process
Through a robust and adaptable AML process, MLRO’s can offer additional value to the firm by offering high value services such as:
Another way to communicate the value that an MRLO can bring is by creating a robust AML process. This process can help a firm withstand more significant risks in services that a firm may charge higher fees for, for example:
- Tax investigation
- Crypto management services (not common in the UK and can charge very high fees if you specialise in them)
- International client speciality
- Charities
- Payroll
- Firms with overseas investment
- And the ability to outsource firm work
Look for business opportunities for the firm, and again, use only the information you know.
In Summary
An anti-money laundering officer (MRLO) plays a crucial role in safeguarding firms from financial and reputational risks. Their responsibilities range from regulatory compliance to managing suspicious activity reports (SARS), internal audits, risk management, and liaising with regulatory bodies. While they add value to a firm, their role is often overlooked and underrated.
It’s not until something bad happens within a firm that the role of an MRLO is considered. To prevent this from happening, MRLOs or those who perform a similar role must effectively communicate the benefits of MRLOs and AML to those in leadership roles at a firm.
MRLOs add value also by helping streamlining onboarding processes, identifying high-risk client, improving client relationships and leveraging insights to identify business opportunities.
If you’re an MRLO or someone whose responsibilities are associated with AML, watch our Firmcheck MLRO Summit 2025—a free, CPD-verified, virtual event. This Summit we held in February goes beyond the surface level with insights from industry experts, practical strategies to tackle compliance challenges and tips on how to build a robust AML strategy.
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