Anti-money laundering

When can our practice accept client funds?

Can we accept funds from a client before completing our customer due diligence?

Before taking any money from a client, you should carry out customer due diligence (CDD) as early as possible.

However, you may accept money on account of costs/fees on a risk-sensitive basis.

CDD must be completed before you:

  • deliver substantive work or benefit
  • permit funds to be deposited in your practice’s client account (unless they are for fees and disbursements)
  • allow property to be transferred
  • allow final agreements to be signed and completed

Carrying out CDD as soon as possible also helps you to avoid any delays further along in the matter, and will help you in your duty to report suspicious activity at an early stage.

This can help protect you from needing to submit a suspicious activity report as a defence against money laundering, where you have a suspicion the funds may be the proceeds of crime.

For more information:

Disclaimer

While every effort has been made to ensure the accuracy of the information in this article, 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.

Have you got a practice question?

Call the Practice Advice Service on 020 7320 5675 or email practiceadvice@lawsociety.org.uk.

The Practice Advice Service is staffed Monday to Friday from 9am to 5pm.

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