UK Has Gone Further Than Other Countries With Anti-Laundering Legislation

by Jason Gorringe, for LawAndTax.com, London

13 February 2003

Speaking to legal publishers Butterworths this week, consumer finance and financial services expert and CMS Cameron McKenna solicitor, Mayoor Patel, suggested that with the pending introduction of the Proceeds of Crime Act 2002 and the Money Laundering Regulations 2003, the UK government has gone above and beyond the call of duty in its legislative fight against money laundering.

'Yes, they have gone beyond their remits but it's not something that I am surprised about. Indeed, after the 11 September, the UK government has taken a much more rigorous line on dealing with economic crimes than the rest of Europe,' Mr Patel explained.

According to the Butterworths report, the Proceeds of Crime Act is set to come into force on February 24, and the Money Laundering Regulations 2003 Act - which will implement the EC's Second Money Laundering Directive - will take effect on June 15.

Mr Patel explained that one of the major changes which will be effected by the two new pieces of legislation will be that: 'for the first time, money laundering offences will extend to the proceeds of any crime and not just serious crimes, drug trafficking offences and terrorist offences.'

The new laws will also broaden the requirement to report money laundering suspicions to all employees in the 'regulated sector', which includes auditors, tax advisers, accountants, real estate agents, and legal professionals.

Although Mr Patel admitted to Butterworths that the increase in the reporting requirements for lawyers will likely spark debate with regard to the conflict between the duty of confidentiality owed to a client and the more strenuous anti-money laundering obligations contained within the new laws, the conflict has always been present.

'Lawyers will probably focus more on knowing their client. But if they confirm the identity of the client, half of the work is done...it will be reasonable for them to assume that any funds that pass through their clients account are 'clean',' he suggested.

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