Receiving funds—money laundering concerns
Receiving funds—money laundering concerns

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

  • Receiving funds—money laundering concerns
  • The risks
  • The requirements
  • Protecting your business

Forthcoming changes: The UK has voted to leave the EU and this will take place on exit day as defined in section 20 of the European Union (Withdrawal) Act 2018. This has implications for law firms. This Practice Note is likely to be affected. It will be updated as and when relevant implementing legislation is published. For more on Brexit, see Practice Notes: Brexit—anti-money laundering and counter-terrorist financing—law firms and Preparing for Brexit—key considerations and action planning—law firms.

Your anti-money laundering (AML) and counter-terrorist financing (CTF) obligations are set out in the Proceeds of Crime Act 2002 (POCA 2002), the Terrorism Act 2000 (TA 2000), and the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLR 2017), SI 2017/692.

Putting 'dirty' money through a solicitors' client account can 'clean' it so you and your account are attractive to money launderers. You must have systems in place to guard against use of your account in this way.

Remember you must ensure you do not facilitate money laundering, whether or not money passes through your account.

The risks

The SRA risk assessment says that you are held in a position of trust, and your client account can be viewed as a way of making criminal funds appear to have a genuine source. Criminals target client accounts as a way