You are here:
  1. Home
  2. Support services
  3. Advice
  4. Practice notes
  5. Responding to a financial crime investigation

Responding to a financial crime investigation

24 September 2018

Who should read this practice note?

All solicitors should read this practice note, particularly managing or senior partners, directors of risk, practice managers, money laundering reporting officers or staff appointed to respond to enquiries from law enforcement.

What is the issue?

  • Solicitors play a key role in facilitating business and financial transactions that underpin the UK economy.
  • Because of this important role, criminals may target your services to help them commit financial crimes or to launder the proceeds of those crimes.
  • As a result, law enforcement may seek access to client files to investigate whether the client, and possibly you or a fellow solicitor, have committed a criminal offence.
  • While you are required to comply with the law, you are also required to keep your client's information confidential.
  • This practice note aims to provide practical assistance on how to manage these competing obligations and provides a short overview of the main powers available to law enforcement when conducting financial crime investigations.
  • If you are the subject of a financial crime investigation, or are still unsure of how to appropriately comply with a request from law enforcement, you should seek legal advice from a specialist criminal law solicitor.

Legal status

Practice notes are issued by the Law Society for the use and benefit of its members. They represent the Law Society's view of good practice in a particular area. They are not intended to be the only standard of good practice that solicitors can follow. You are not required to follow them, but doing so will make it easier to account to oversight bodies for your actions.

Practice notes are not legal advice, nor do they necessarily provide a defence to complaints of misconduct or of inadequate professional service. While care has been taken to ensure that they are accurate, up to date and useful, the Law Society will not accept any legal liability in relation to them.

For queries or comments on this practice note contact the Law Society's Practice Advice Service.

Professional conduct

The SRA has published a Handbook, which sets out all the SRA 's regulatory requirements. It outlines the ethical standards that the SRA expects of legal practices and practitioners and the outcomes that the SRA expects them to achieve for their clients.

There are ten mandatory principles which apply to all aspects of practice. They can be found in the SRA Handbook. You should always bear in mind the ten principles and use them as your starting point.

Those which are particularly relevant in this context are as follow:

  • Uphold the rule of law and the proper administration of justice;
  • Act with integrity;
  • Do not allow your independence to be compromised;
  • Comply with your legal and regulatory obligations and deal with your regulators and ombudsmen in an open, timely and co-operative manner; and
  • Behave in a way that maintains the trust the public places in you and in the provision of legal services.

The SRA Handbook includes a Code of Conduct, which replaces the Solicitors' Code of Conduct 2007. The new Code establishes outcomes focused conduct requirements and each chapter outlines outcomes and indicative behaviours.

As detailed below, chapter 4 which pertains to client confidentiality and chapter 5 which pertains to your relationship with the court are particularly relevant when responding to financial crime investigations.

SRA Principles

There are ten mandatory principles which apply to all those the SRA regulates and to all aspects of practice. The principles can be found in the SRA Handbook.

The principles apply to solicitors or managers of authorised bodies who are practising from an office outside the UK. They also apply if you are a lawyer-controlled body practising from an office outside the UK.

Terminology

Must - A specific requirement in legislation or of a principle, rule, outcome or other mandatory provision in the SRA Handbook. You must comply, unless there are specific exemptions or defences provided for in relevant legislation or the SRA Handbook.

Should - Outside of a regulatory context, good practice for most situations in the Law Society's view. In the case of the SRA Handbook, an indicative behaviour or other non-mandatory provision (such as may be set out in notes or guidance).

These may not be the only means of complying with legislative or regulatory requirements and there may be situations where the suggested route is not the best possible route to meet the needs of your client. However, if you do not follow the suggested route, you should be able to justify to oversight bodies why the alternative approach you have taken is appropriate, either for your practice, or in the particular retainer.

May - A non-exhaustive list of options for meeting your obligations or running your practice. Which option you choose is determined by the profile of the individual practice, client or retainer. You may be required to justify why this was an appropriate option to oversight bodies.

Client - The person for whom you act and includes prospective and former clients.

The Law Society also provides a full glossary of other terms used throughout this practice note

Contents

  1. Ethical obligations on disclosure
    1. General comments
    2. Confidential information
    3. Information subject to Legal Professional Privilege
    4. Express undertakings of confidentiality to the court
     
  2. Discussing law enforcement requests and orders
    1. General comments
    2. Discussions with law enforcement agencies
    3. Discussions in-house and with third parties
    4. Discussions with clients
     
  3. Powers to obtain material without entry
    1. General comments
    2. Notice to disclose - s61 Serious and Organised Crime and Police Act 2005 (SOCPA)
    3. Notice to disclose - s2 Criminal Justice Act 1987 (CJA)
    4. Production order - s345 Proceeds of Crime Act 2002
    5. Disclosure order - s357 Proceeds of Crime Act 2002
    6. Notice to produce - Schedule 36 Finance Act 2008
    7. Further information order - s339ZH Proceeds of Crime Act 2002
    8. Production order - s20BA Taxes Management Act 1970
    9. Production order - Schedule 1 Police and Criminal Evidence Act 1984 (PACE)
      1. Key features
      2. Who can use this power?
      3. Notice
      4. Time frames
      5. What happens if I don't comply?
      6. Can I challenge the notice?
       
     
  4. Powers to enter and obtain material
    1. General comments
    2. Your rights and responsibilities
     
  5. Maintaining a complete record
    1. Copying files
    2. Forwarding files to another solicitor
    3. Voluntary return
    4. Application to the court
     
  6. Powers of arrest
    1. Arrest without a warrant
    2. Arrest with a warrant
    3. Your rights and responsibilities
     
  7. Answering questions and providing statements
    1. Questions and statements about the client
    2. Questions and statements about your involvement
     
  8. More information
    1. Law Society products and services
    2. Other
     

Sign In or Register

This is premium content

To access premium content login to My Law Society.

Not registered? My Law Society is free and open to all users. Register below.

Not registered?

Registration is free and will only take a couple of minutes.

If you are a member of The Law Society you can use your MySRA account details to register.

Register
Update your contact preferences

Update your details in My Law Society and tell us how you want to hear from us.

Practice Advice Service

The Practice Advice Service provides a dedicated support line for Law Society members and employees of law firms. Call us on 020 7320 5675.

> Contact the Practice Advice Service
Previous versions

Previous versions of this page are available below:

Recommended

Vulnerable witness
Advocacy and the vulnerable training

This training teaches how to advance a client’s case well whilst ensuring witnesses are not subjected to undue stress.

Advocacy and the vulnerable training > More
Lexcel Accreditation
Lexcel

The Law Society's quality mark for any practice that can demonstrate excellence in legal practice management and client care.

Lexcel > More
Fingerprint and magnifying glass
Anti-money laundering conference 2018

The latest in AML and financial crime from experts in the field

Anti-money laundering conference 2018 > More
Justice Week
Ethical Obligations of Lawyers During Major Incidents

Join us to explore the ethical obligations of lawyers during major events such as the Grenfell Tower disaster and terrorist attacks.

Ethical Obligations of Lawyers During Major Incidents > More
Criminal Litigation Accreditation
Criminal Litigation - recognition for excellence

Our accreditation covers all types of criminal law work and supports practitioners to qualify to apply for inclusion on local duty solicitor rotas.

Criminal Litigation - recognition for excellence > More