Home Office suspended funds scheme: share your views
Under the UK’s anti-money laundering regime, where a transaction is related to suspected criminal funds, those working in the regulated sector are required to:
- report the suspicion internally to a money laundering reporting officer
- report the suspicion to the National Crime Agency, and/or
- request a defence against money laundering for consent to go ahead with the transaction
Suspected criminal funds are suspended while reports are investigated by law enforcement.
According to the Home Office, “significant volumes of these funds remain suspended across industry with no sustainable mechanism for release”.
These suspended funds “can pose legal and compliance risks” to the organisations that hold them.
The proposed scheme intends to receive funds that industry wishes to transfer where:
- the funds have been suspended on suspicion they are criminal in nature
- it has not been possible to return the funds to the rightful owner, and
- the funds have not been recovered through law enforcement action
Membership of the scheme would be voluntary.
All businesses within the regulated sector that are currently freezing funds or may wish to in future could take part in the scheme.
What this means for solicitors
The scheme would allow organisations to divest themselves of suspected criminal funds, while "protecting legitimate customers’ rights to their private property", according to the government.
Organisations potentially impacted by the scheme have an opportunity to share their views on the most appropriate scheme to be implemented.
This includes providing specific comments regarding the applicability and viability of the scheme to their business.
Email your response to HOSuspendedFunds@homeoffice.gov.uk by Friday 15 September 2023.
The government intends to introduce the legislation underpinning the scheme when parliamentary time allows.
Implementation is not expected until 2025/26 at the earliest.
I want to know more
The Home Office is holding a Q&A for the legal sector on Monday 7 August at 11am.
To find out more about the session, email HOSuspendedFunds@homeoffice.gov.uk.