Anti-money laundering work continues
05 February 2020
Our anti-money laundering work remains a priority, and we continue to step up our efforts to stop criminal and terrorist gangs using law firms to launder their ill-gotten gains.
On January 10, the 5th Anti-money Laundering Directive came into force via UK legislation. It introduced a number of changes aimed at tightening defences against money laundering infiltration, with some practical impacts on law firms and their processes.
This includes further strengthening customer due diligence and checking on relevant registries. The legislation also flags changes around the definition of tax advice.
The Legal Services Affinity Group, which we are part of, is drawing up guidance on the new directive, which will be published in due course. A summary of guidance has been produced in the interim. Further information is available here.
We have also asked those of you that fall within the scope of the 2017 regulations to make a declaration to us that you have a compliant firm-wide risk assessment in place. This is required by law, as well as by our regulations.
This exercise was spurred by a review of the practices of 400 firms over the summer which found a fifth did not have a compliant assessment in place, and many of those that did were of insufficient quality. We are continuing to take steps to ensure firms are meeting their obligations, including enforcement action.