Help! I'm a new MLRO: Engagement with senior management
This article was originally published in 2012.
So you come back from holiday to find you have been elected the money laundering reporting officer (MLRO). You ask yourself a number of questions, the main one being 'how do I persuade my board and senior partners that this Proceeds of Crime Act is serious?'
Not an easy challenge.
Make sure that you know your subject, read the legal sector AML Guidance and attend MLRO training. You need to be confident that you can explain that money laundering includes transferring the savings from not paying tax or from committing an environmental offence. A thorough understanding of the law will enable you to explain how serious this legislation is.
Apply that knowledge to your firm by doing your firm-wide risk assessment, i.e. 'know your business' and be clear about your real areas of risk. If you do conveyancing, expect to spend more time with that team on ID issues, source of funds etc. Criminal defence work is less likely to require your input. If your Court of Protection team acts for clients transferred from the Personal Injury team you will know about the source of funds.
Talk to the partners in the higher risk areas to work together to mitigate the risks and ensure that staff are properly trained about the real risks they might face. Case studies about other lawyers in the same practice area will focus the mind. Combining your expertise with their practical knowledge pays dividends.
You need to have the systems in place to ensure that ID is obtained but you also need to ensure that people understand how draconian the law is and that they must ask for your help.
The measure of a successful MLRO is not how many reports to the National Crime Agency they make but how many sensible queries they receive.