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Post Info TOPIC: Could this be considered as Money Laundering ?
roger2010


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Could this be considered as Money Laundering ?
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Hi

 

I took on a new client in December 2009, He started his Business as a sole trader repairing Motor Vehicles in rented premises. He sub lets part of his workshop to a

Self employed electrical mechanic (his tenant).  They are two completely separate entities.    My client has credit card facilities registered to his business-trading name.  His tenant does not have this facility.  Now this is the problem..

The tenant has been allowed to use my Clients business credit card facility. My client would then give him cash to compensate. I explained to him that these amounts, which are paid directly into his Business Bank account, would have to be included in his total turnover/income. I also told him there was no way I could legally disguise the amounts involved.

 

Guess what !!!  this client thinks that I should be able to sort it

I do not know of any legally accounting remedy I can take to compensate his accounts,

I would be very pleased to hear if anyone out there has had a similar experience and if so what was the outcome. 

 

Roger2010



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Brewsie


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Can you not just consider the cc receipts as creating a debt to the tenant?

If you post the bank receipt against a new nominal set up as a short term liability, it shows the distinction between his own transactions and the tenants and doesn't go near his sales ledger.

When he pays the tennant, then show a transaction between e.g.petty cash and the liability a/c to clear the debt.

I would suggest that there is some paperwork between your client and his tennant to document the payments and a non-cash transaction would be better still.

Have I missed something?

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BackOfficeGroup


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maybe if its not much, he could put it against his rent that he charges?

I dont think its the right thing to do though, very dubious even if not intended to be, asking for trouble in so many ways.

Also, does he deduct the card charges from the bank before he hands over the cash or does he pay that for him!!

P

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