Removal of ‘intent’ clause in money laundering guidelines leaves legal firms at risk

17 April, 2015

Thousands of lawyers could find themselves at risk of money laundering offences due to the removal of a clause from suspicious activity reports (SAR) regime, according to Law Society.

The Law Society, which represents solicitors across the UK, is calling for the re-inclusion of the element of intent into money laundering offences.

It comes as the Home Office launches a fresh consultation into the SAR regime, which requires law firms to report suspicious activity that could be linked to money laundering.

Under the Current National Crime Agency (NCA) guidelines, anyone working in the ‘regulated sector’ commit an offence if they do not submit a SAR to the NCA, if they know or suspect, or have reasonable grounds to know or suspect, that another individual or person is engaged in money laundering.

The Society have said that this unclear guidance needed clarification and that they feel that the rules should be changed so that lawyers must report clients only if they suspect intent to launder money.

In a letter to the Home Office, the Law Society said: “We believe the resources of the NCA are better focused on money laundering in action.

“The [suggested] changes would reduce the administrative burden around consent requests while still providing law enforcement with information that will be useful in the fight against money laundering.”

The number of SAR’s filed in recent years has increased, according to the NCA and more than 350,000 SAR’s were raised in 2013/14. Money laundering is a significant issue for law firms and keeping on top off accounts is an extremely important part of minimising the risk.

At Watson Buckle our legal finance experts can help you make sense of your accounts so that you can spot issues before they become a more serious problem. For more information, please contact us.