Money laundering compliance officer—law firms

The following Practice Compliance practice note provides comprehensive and up to date legal information covering:

  • Money laundering compliance officer—law firms
  • What is an MLCO?
  • Is it compulsory to appoint an MLCO?
  • Qualifying requirements—who to appoint
  • Responsibilities of the MLCO
  • Relationship between MLCO, nominated officer and COLP
  • Senior management responsibilities
  • Registration of MLCO
  • Training the MLCO
  • Oversight of firm’s compliance arrangements
  • More...

Money laundering compliance officer—law firms

This Practice Note is intended for law firms that are subject to the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLR 2017), SI 2017/692. It provides guidance on the requirement to appoint a board-level (or equivalent) person as the officer responsible for the firm’s compliance with MLR 2017. This position is commonly known as the money laundering compliance officer (MLCO) or board-level person.

Not all firms are required to appoint an MLCO. Sole practitioners are not required to do so and other firms are only required to appoint an MLCO where:

  1. they are caught by MLR 2017, and

  2. it is appropriate to appoint an individual having regard to the size and nature of the business

This Practice Note reflects draft Legal Sector Affinity Group (LSAG) AML guidance, published on 20 January 2021. It awaits HM Treasury approval. Note that any content may be amended before the final version is published with the Treasury's approval. This Practice Note also reflects key findings from the SRA’s AML visits 2019–2020. The SRA is conducting a thematic review into the MLCO role in 2021 which will consider what training and experience may be appropriate and what makes a good MLCO.

What is an MLCO?

The term ‘money laundering compliance officer’ is not used in MLR 2017.

However, the term MLCO has been adopted across

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