I am the MLRO and money laundering compliance officer in a new firm, which will be providing regulated services. My partners and I are in the process of conducting the practice-wide risk assessment. Is there any guidance on what to consider?
When carrying out your practice-wide risk assessment, you must take into account:
- information on money laundering and terrorist financing risks made available by your supervisory authority following their own risk assessment - read the Solicitors Regulation Authority's risk assessment
- risk factors relating to your customers, the countries or geographic areas in which your business operates, your products or services, your transactions and your delivery channels.
Going forward, you should monitor the nature of any issues raised in suspicious activity reports made by you to understand any risks they may have identified.
Your risk assessment may also include consideration of:
- the UK's national risk assessment
- the EU's supra-national risk assessment
- the Financial Action Task Force (FATF) Risk-based Approach for Legal Professionals
- if you provide services in other jurisdictions, any relevant FATF mutual evaluations, national risk assessments, or publicly available materials in respect of the risks in those jurisdictions, and
- any other material which may be relevant to assess the risk level particular to your practice: for example, press articles that may have arisen in certain jurisdictions.
Having assessed the money laundering and terrorist financing risk your practice faces, you should then consider any mitigating factors or reasonable controls that you can implement to manage these risks and reduce their significance to a proportionate and acceptable level.
For further information, please see the Law Society's anti-money laundering guidance for the legal sector.
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.
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