Professional bodies representing bankers and accountants have clashed with the Law ­Society over its views on the severity of the UK’s anti-money laundering regime.

Giving evidence to the House of Lords Inquiry into Money Laundering and the Financing of Terrorism last week, the British Bankers’ Association (BBA) and Institute of Chartered Accountants in England and Wales (ICAEW) opposed Chancery Lane’s key argument in its written submission.

The Society argues that ­European anti-money laundering law has been applied more strictly in the UK than in other countries and, therefore, creates a disproportionate burden. Unlike in most EU nations, criminal penalties can be applied to individuals, including solicitors, who fall foul of the UK’s reporting regime.

In oral evidence in the Lords last week, Sally Scutt, BBA deputy chief executive, said: ‘I think we have to remember that the reputation of the UK…as an international centre rests upon us getting this framework right.’ Of the argument that other countries are more lax, she said: ‘Two wrongs don’t make a right.’

Felicity Banks, head of business law at the ICAEW, said: ‘I couldn’t agree more. None of the [money laundering] reports made by our members have been wasted.’

Responding to Scutt and Banks, Law Society Chief Executive Des Hudson said: ‘The Law Society believes there are some systemic problems.’

The committee asked all ­parties to provide further submissions setting out how they believe the anti-money laundering regime should be changed.