Money laundering and proceeds of crime

You might have to have a preliminary meeting with a prospective direct access client purely to comply with anti money laundering regulations – quite apart from a preliminary meeting being good practice.

The Bar Council has produced detailed guidance on the Money Laundering Regulations 2007 and the Proceeds of Crime Act 2002 (POCA). This guidance applies to all instructions. 

The Money Laundering Regulations apply to barristers who are asked to advise at the planning or execution stage in transactions which involve either: 

a.    the buying or selling of real property or business entities; 
b.    the creation, operation, or management of trusts, companies or similar structures. 

The requirements upon barristers who conduct relevant business are clearly set out in the Bar Council guidance. In short they are:

• Customer due diligence e.g. (i) identifying the client or beneficial owner prior to the establishment of the business relationship, or the execution of the transaction, (ii) obtaining information about the business relationship or transaction, (iii) monitoring the business relationship on an ongoing basis.
• Record keeping procedures – records of all relevant transactions and evidence of client identity must be maintained for five years from the date on which the last transaction was completed.
• Procedures to forestall money laundering, and training staff – all barristers and sets of Chambers who undertake work within the ambit of the Regulations should have in place and operate general systems and procedures for ensuring compliance with the Regulations. This includes training staff on the law relating to money laundering/terrorist financing and on how to recognise and deal with transactions and other activities which may be related to money laundering/terrorist financing.

The POCA makes it an offence to enter into or become concerned in an arrangement which you know or suspect facilitates (by whatever means) the acquisition, retention, use or control of criminal property by or on behalf of another person.