Suspicious activity reporting - updates from the NCA
National Crime Agency Annual Report
The UK Financial Intelligence Unit has recently published the 2019 National Crime Agency Report on SARS with details on the reporting regime for the past year.
A total of 478,437 suspicious activity reports (SARs) were submitted in the reporting period between April 2018 and March 2019, up from 463,938 in the previous year. Notably the number of defence against money laundering (DAML) SARs increased by 52%, with 34,453 requests for consent filed in the relevant period.
There was an even more dramatic increase in the amount of funds restrained or seized by law enforcement or otherwise recovered by HMRC. In total there was a 152% increase to £131,667,477, which was overwhelming made up of restrained funds.
In total, independent legal professionals filed 2,774 SARs. This represents 0.58% of the total volume of SARS and was an increase on the previous year (up 4% on the 2017-2018 volumes). As ever, a significant proportion of SARS filed by legal professionals were DAMLS, with lawyers seeking consent in nearly nearly two-thirds of cases.
Revised Glossary Codes
The National Crime Agency (NCA) have also published updated guidance on best practice for the use of glossary codes when filing a SAR. Glossary codes assist the NCA to triage SARs related to particular predicate offences and to identify and process DAML SARs. When seeking consent, for example, you should use the code XXS99XX.
Given such a high proportion of SARs filed by lawyers are DAMLs, we and the NCA are keen to understand the kinds of predicate offences for which lawyers are seeking consent.
We know the all crimes for all times approach adopted in the Proceeds of Crime Act 2002 will mean a DAML may be necessary in a case that is unlikely to be of interest to law enforcement.
If your SAR relates to what may be considered a 'technical' breach you can now use the analytical code 089-LS like a glossary code when drafting and submitting a SAR.
In the medium term we hope the use this code will enable the NCA and ourselves to obtain more granular data about the nature of legal sector SARs and the best approach to their efficient handling.
In addition to the NCA resources, we publish a variety of materials to assist with identifying suspicious activity and filing a SAR.