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FAQ: Carrying out customer due diligence

18 February 2016

The Law Society’s Practice Advice Service outlines the approach a firm should take to comply with customer due diligence obligations as required by the Money Laundering Regulations 2007.   

My firm is thinking of offering half-hour fixed fee interviews for matrimonial matters. What procedures should I put in place to comply with the firm’s obligation to carry out customer due diligence as required by the Money Laundering Regulations 2007?  

The aim of the Money Laundering Regulations 2007 (the Regulations) is to limit the use of professional services for money laundering by requiring professionals to know their clients and to monitor the use of their services by clients.

The Regulations are not intended to prevent individuals obtaining legal advice and indeed the Treasury has confirmed that certain activities including the ‘provision of legal advice’ and the payment of a solicitor’s bill are not covered by the Regulations.

It is therefore for your firm, using a risk based approach, to decide how far you want to go in identifying potential clients if you are simply meeting them and giving advice in this half hour interview.

For further information, please see the anti-money laundering guidance.

The Treasury has formally approved this practice note, which means that the SRA and the courts have to take regard of it when considering if a solicitor’s conduct was reasonable in relation to any allegations of failure to comply with the Regulations or of money laundering.

This FAQ is compiled by the Law Society’s Practice Advice Service, telephone 020 7320 5675. Comments relating to it should be sent to Mrs. Anjali Mouelhi, Solicitor Technical Lead, The Law Society, 113 Chancery Lane, London WC2A 1PL.

While every effort has been made to ensure the accuracy of the information in this FAQ, it does not constitute legal advice and cannot be relied upon as such. The Law Society does not accept any responsibility for liabilities arising as a result of reliance upon the information given.


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