Register of overseas entities – Lessons for solicitors considering becoming a verification agent
Last year I wrote about whether it is too risky for solicitors to act as verification agents. I decided to find out first hand what the risk implications are, by signing up as a verification agent.
Some solicitors and law firms have agonised over whether to provide verification as a service to their offshore clients. The demand is certainly there.
Here is what I learned and observed about the process.
ICYMI: Terrorist financing – the forgotten piece of AML compliance
See below for the recording of our free webinar on this topic, which took place on 22 February at 12pm.
The Terrorism Act 2000 (TA) makes it an offence to finance terrorism. Terrorism is widely accepted to mean ‘the unlawful use of violence and intimidation, especially against civilians, in the pursuit of political aims’. Those political aims can take many forms, and the unlawful act is not the monopoly of any particular group of activists.
Terrorist financing is the collection of funds (legitimate or not) with the intention or knowledge that they will be used to finance terrorist activities (even if they are not actually used for those purposes).
As with the Proceeds of Crime Act 2002 (POCA), all practising solicitors are within scope of the TA. Unlike the Money Laundering Regulations, the TA does not just apply to a defined set of ‘transactional’ legal services, tax advice and ‘trust and company service’ work.
Terrorist financing compliance is a fundamental part of the Anti-money laundering (AML) framework, within which solicitors and law firms operate. The legislation operates hand-in-hand, sharing the similar offences and obligations. POCA and TA effectively mirror each other in certain respects.
But why does AML get all the attention?
News and Guidance
Law Society – New and updated practice notes (may require login)
- Gazette – A new McCarthyism – Is the SRA’s focus on SLAPPs and abusive litigation overblown, based on its own Thematic Review? A compelling view from a media lawyer.
- Feature – Your AML questions answered – including DAMLs, MLRO authorisation, new discrepancy reporting obligations, updating CDD.
- Guide – Tipping off and prejudicing an investigation
Other Updates
- UK Financial Intelligence Unit – Guidance on submitting better quality suspicious activity reports (SARs) – (to be read in conjunction with NCA guidance).
- UK Financial Intelligence Unit – SARs reporter booklet – updated with case studies and current glossary codes.
- FATF – Consolidated assessment ratings updated (20 Feb 2023) – an up-to-date overview of the ratings that assessed countries obtained for effectiveness and technical compliance.
- ICO enforcement (Martin Swan) – 111 call centre advisor convicted and fined £630 under the Data Protection Act for illegally accessing patient records.
Free webinars
Webinar recording: Terrorist financing – the forgotten piece of AML compliance
Thanks to everyone who took part in this session on 22 February with Rachael and Jon.
You can find the recording here (Passcode: $QC3@b*Z) – available for 21 days.
The presentation slides are here
Save the date
Our next monthly webinar will take place on Wednesday 29 March at 12:00pm. Invitations and topic to be sent out shortly.
As always clients get first refusal on places, with the remainder opened up to a wider audience.
SRA and SDT disciplinary decisions
- Charles Ayodemiji Ewan – fined £10,000 for using his firm’s client account as a banking facility.
- Richard Winters – fined £8,000
- Siva Winters – fined £8,000
- Andrew Brian Mark – non-solicitor Director fined £1,800 for Accounts Rules breaches.
- Paul Smith – rebuked for failures relating to the closure of a practice.
- Alliance Solicitors – fined £1,500 for failing to have a compliant AML firm wide risk assessment and policies and controls in place.
- Gurpralad Landa Singh – fined £12,500 for failing to properly supervise a trainee who had conduct of property transactions which bore the hallmarks of fraud.
- Daniel Paul Hugh Hutchings – fined £30,000 for sexual misconduct (inappropriate touching and comments).
- Umar Rehman – struck off for receiving client money directly into his own bank account.
- Sonia Hunjan – fined £15,000 for facilitating a ‘secret, snap, sale of inheritance property, at a heavy discount, in circumstances where there was a restriction on the title, there were other family members…Only a manifestly incompetent solicitor could have missed these warning signs, failed to take obvious lines of enquiry, and facilitated such a scheme.’
- Terence Donnellan – suspended for 3 months after continuing to taken on cases when his firm was in the process of closure, resulting in client claims on the Indemnity Fund.
- Michael William Pilkington – struck off for using disbursement monies to pay business expenses, and failing to report his firm’s serious financial instability to the SRA.
- Charles Ayodemiji Ewan – fined £10,000 for using his firm’s client account as a banking facility.
