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Anti-money laundering Q&As
The Law Society’s Practice Advice Service can give you a helping hand. Its team of solicitors advises on practice and procedure on various subjects, including anti-money laundering.
The Law Society’s Practice Advice Service is a confidential, telephone-based helpline for solicitors.
Our team of solicitors answers questions on a wide variety of subjects, including:
- anti-money laundering (AML)
- client care
- complaints handling.
The service operates Monday to Friday 09:00-17:00 on 020 7320 5675.
Here is a selection of questions and answers on anti-money laundering compiled by the Practice Advice Service:
Q1. I am in the process of setting up a new firm as a sole practitioner. I will be dealing mainly with conveyancing and probate matters and I am considering my obligations under the Money Laundering Regulations 2007. Will I be required to appoint a nominated officer?
A1. Both areas of work are activities within the regulated sector. Regulation 20(3) provides that there is no requirement to have a nominated officer where you are an individual providing regulated services and who neither employs nor acts in association with any other person. In essence, you will be the nominated officer as you will be the person making reports to the National Crime Agency.
For further information, please see Chapter 3 of the Law Society’s anti-money laundering practice note .
Q2. When conducting customer due diligence on a client, do I need to obtain their consent to carry out an electronic verification check on their identity?
A2. No, you are not required to obtain consent from your client when carrying out electronic verification, but you must inform them that the check will take place. The Law Society has provided an example of a clause which could be used in your terms of business. Please see the Law Society’s practice note on client care information. You may also wish to consider our anti-money laundering practice note.
Q3. I act for the buyer in a conveyancing transaction and have today made a Suspicious Activity Report (SAR) to the National Crime Agency (NCA). We are due to exchange contracts tomorrow and the seller’s solicitor is pressing me for reasons why we will be unable to exchange. Will I be guilty of committing a tipping-off offence if I discuss the SAR with him?
A3. Under s333C of the Proceeds of Crime Act 2002, disclosures between institutions, including disclosures from a professional legal adviser to another professional legal adviser, will be permitted if all the following criteria are met:
- the disclosure is made to another lawyer in a European Economic Area (EEA) state, or one with an equivalent AML regime
- the disclosure relates to a client or former client of both parties, a transaction involving them both, or the provision of a service involving them both
- the disclosure is made for the purpose of preventing a money laundering offence
- both parties have equivalent professional duties of confidentiality and protection of personal data.
However, it may not be appropriate to discuss the SAR with the seller’s solicitor if you have any concerns about his compliance and/or his involvement in the suspicious activity.
For further information, please see Chapter 5 of the Law Society’s anti-money laundering practice note .
Q4. Do you need advice on your obligations under the anti-money laundering regulations 2007 and the Proceeds of Crime Act 2002?
A4. The Law Society’s anti-money laundering helpline is a free, confidential, telephone-based helpline for solicitors. Our team of solicitors answers questions on a wide variety of areas including customer due diligence, suspicious activity reports and sanctions.
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.
This article is compiled by the Law Society’s Practice Advice Service. Comments relating to the questions should be sent to Mrs Anjali Mouelhi, practice advice service manager, The Law Society, 113 Chancery Lane, London WC2A 1PL.