Accountancy's largest professional body was at pains to stress that it is not a threat to solicitors this week, following reports of a battle with the legal profession over proposals to extend legal privilege to accountants in certain circumstances.

A Home Office consultation - which closes at the end of this month - proposes to extend legal privilege to accountants in relation to their reporting duties under money laundering legislation, where they are giving comparable legal advice to solicitors.


The extension of privilege would apply to accountants, auditors and tax advisers in relation to the Proceeds of Crime Act 2002 and Money Laundering Regulations 2003.


Passmore: solicitors will not lose any business
Simmons & Simmons partner Colin Passmore, who acts for the Institute of Chartered Accountants of England and Wales (ICAEW) in relation to the consultation, said: 'Accountants are not going to start advising on legal issues that they do not already advise on, and lawyers will not lose business as a result of this. All we are persuading the government to do is to bring our legislation into line with Europe, in the interests of people who matter most, who are not the accountancy profession, but clients.'



Karen Silcock, chairwoman of the ICAEW money laundering working party, said solicitors should not be concerned by the proposals. She said: 'This only applies to highly specific circumstances regarding reporting under money laundering duties. It could provide benefits to the way lawyers and accountants work together for clients.'


A Law Society spokesman said that the Society had not yet submitted its response to the Home Office consultation, and had no plans to instruct counsel on the issue. The ICAEW instructed David Anderson QC prior to the Home Office consultation.


The Law Society spokesman said: 'We are considering whether proposals relating to legal professional privilege address the concerns identified by the Law Society in its guidance for solicitors, thereby ensuring that clients' confidentiality is fully and properly protected by law. We will also be urging the Home Office to take this opportunity to address the disproportionate effect the Act has had to the proceeds of all criminal offences, however minor.'