Barristers, chambers and BSB entities need to be aware of the risk of becoming involved in money laundering and/or terrorist financing.
- If you undertake work that falls within the Money Laundering and Terrorist Financing Regulations, then you have specific obligations under the Regulations.
- If you are a barrister acting in a matter that is not covered by the Regulations, you still have an obligation not to commit an offence within the Proceeds of Crime Act 2002 and Terrorism Act 2000.
- Barristers have a legal obligation to report to the Office of Financial Sanctions Implementation (OFSI) information that could undermine UK financial sanctions.
New for 2020 - Amended Money Laundering Regulations
On 10 January 2020, the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulation 2017 were updated by the Money Laundering and Terrorist Financing (Amendment) Regulations 2019. The Amendment Regulations contain changes brought in by the EU’s Fifth Money Laundering Directive. This is not affected by Brexit.
The changes include:
- an expanded definition of “tax advisers” that come within scope of the Regulations;
- additional requirements relating to Customer Due Diligence checks; and
- a new requirement to report discrepancies on the register at Companies House.
If you do work that falls within the scope of the amended Money Laundering Regulations, you should review the changes and take steps to update your anti-money laundering policies, controls and procedures to ensure that you comply with the changes.
We have published interim guidance which summarises the key changes that affect barristers and BSB entities. This was developed jointly by all the legal sector regulators. The guidance is not exhaustive and should be read in the context of the Amended Regulations.
We are currently working with other legal regulators and representative bodies to update the joint legal sector guidance. The updated guidance will be approved by HM Treasury and published on our website. We anticipate that this will be available by March 2020. Further updates will be provided in due course. There is no grace period, as such, for complying with the amended Regulations, but we will be taking a proportionate approach to enforcement.
HM Treasury has decided that there should be one set of guidance for the legal sector in England, Wales, Scotland and Northern Ireland. We have worked with the other legal regulators and representatives from the professions to develop the joint guidance.
The Anti-Money Laundering Guidance for the Legal Sector has been approved by HM Treasury.
You are not required to follow this guidance but doing so will make it easier to account to regulators and others for your actions.
The Bar Council has also developed guidance with some case studies to further assist barristers, chambers and BSB entities in applying the Regulations.
Your obligation to carry out a risk assessment
Under Regulation 18 of the Money Laundering and Terrorist Financing Regulations, self-employed barristers and BSB entities who carry out work that falls within the scope of the Regulations must take appropriate steps to identify and assess the risks of money laundering and terrorist financing to which their practice or business is subject. Our risk assessment page has further information.
Declaration at Authorisation to Practise and obtaining a criminal records check
When you apply for or renew your practising certificate, you are asked to declare whether you carry out work that falls within the scope of the Money Laundering Regulations. If you do, you must obtain a criminal records check from the Disclosure and Barring Service. You can find further information about your obligations online.
National Crime Agency and Suspicious Activity Reports
The National Crime Agency (NCA) has prepared a set of frequently asked questions on the process for obtaining a Defence Against Money Laundering (DAML). A DAML is a term used by the NCA to refer to “appropriate consent” to carry out an activity that may result in a person committing a principal money laundering or terrorist financing offence.
Contacting us with a concern about Money Laundering
The BSB’s Money Laundering Hotline is a confidential service that anyone can use to report a concern to us about a person or an organisation we regulate, in connection with Money Laundering.
If you have any comments or questions about this page, please contact us.