It is important to remember that failure to use any of the services listed in Regulation 12 does not relieve you of legal obligations under the Proceeds of Crime Act, particularly sections 327 to 329. You should always be vigilant about the possibility of money laundering by your business and your obligation to file a suspicious activity report if necessary, and therefore you should follow a basic anti-money laundering policy and procedures that allow you to pass on basic due diligence to your supervisor or law enforcement. Record-keeping that meets the requirements of the regulations helps a practice meet those requirements. A practice may designate the MLRO as the person responsible for liaising with law enforcement agencies. Answers to some of the most frequently asked questions about anti-money laundering to help the legal profession understand the reasons and responsibilities surrounding anti-money laundering regulations. It`s also important to determine if your practice is involved in cases involving multiple jurisdictions. Money launderers are often drawn to cases that transfer money or value across borders to conceal property and thwart investigations. Must – a requirement of the law or a requirement of a regulation or other mandatory provision. You must comply with them, unless there are specific exceptions or defenses in the relevant laws or regulations. All data subjects must demonstrate to their supervisory authority that they have adopted a risk-based approach to managing money laundering and terrorist financing risks in their businesses. Beyond compliance, there is a natural incentive for firms to confidently determine who their client is and the details of each transaction they participate in or facilitate. It protects them from inadvertently facilitating a series of financial crimes or being ripped off themselves.
The permit must be granted before any activity that would bring the practice or person within the scope of the regulations. This applies to both established and new practices. Established practices must obtain approval from new BOOMs before taking office. The FATF, in particular, provides a valuable source of information on the relative risks associated with certain jurisdictions in its mutual evaluation system, which provides an in-depth description and analysis of each country`s system for preventing criminal exploitation of the financial system. It also establishes a list of countries with “strategic deficiencies” in their anti-money laundering initiatives and a list of “low capacity” countries, i.e. countries that have economic or sociological constraints that prevent them from effectively implementing AML/CFT policies. If the Client and the Service are considered to present a higher risk of money laundering or terrorist financing, it may be appropriate to consider the overall risk of the case as a high risk. You must clearly document the reasons for departing from this approach.
Depending on the type of discrepancy, you should determine whether this is documented on a case-by-case basis or as part of your WPRA. Non-exhaustive examples of serious offences include: Intentional or intentional negligent violations of legal requirements relating to applicable laws or anti-money laundering regulations This section describes the roles, responsibilities and appointment of senior officers in a practice, including the Money Laundering Reporting Officer (MLRO), Anti-Money Laundering Compliance Officer (MLCO) and beneficial owners, key employees and managers (BOOMs) and some of the structures that firms need or should put in place (e.g., training and independent audits). We have a dual role in enforcing anti-money laundering laws and regulations: Similarly, Part 2 clarifies that most of the work carried out by notaries (or in Scotland by lawyers acting exclusively as notaries) in their primary role as public certifying agents does not fall within the scope of the rules. The definition of a business relationship under the rules requires that the lawyer expect, at the time of contact, that the relationship will have an “element of duration” (R4). This must be interpreted in the broadest sense, as it is reasonable to assume that any lawyer expects that other matters can be dealt with at each first contact with a client. When dealing with a client for the first time, you must assume that a business relationship will arise, unless you have explicit reasons to know that this is not the case: that there will be no “duration element”. While we are committed to educating and assisting our members in preventing the Scottish legal system from being used to launder criminal or terrorist funds, we are required by regulations to take appropriate action if members fail to comply with the requirements of the regulations. Sometimes clients are not able to provide standard verification documents. The objective of the Regulation is not to deny individuals access to legal services for legitimate transactions, but to mitigate the risk of legal services being used for money laundering purposes. You should consider whether the inability to provide you with a standard test is consistent with the client`s profile and circumstances, or whether you might suspect that ML/TF exists. The introduction of cash into the banking system can be part of the investment phase of money laundering.