Money laundering is a significant enabler of serious and organised crime which, according to the National Crime Agency, generates more than £12bn annually in the UK. The National Risk Assessment of Money Laundering and Terrorist Financing (NRA) has identified legal services, and in particular conveyancing, both residential and commercial, as one of the services most at risk of exploitation by money launderers.
Each year we inspect approximately 25-30% of our supervised population.
At the start of the reporting period (6 April 2020 – 5 April 2021), 24 practices were considered high risk, 29 were considered medium risk and 172 practices were considered low risk.
By the end of the reporting period the number of high-risk practices reduced to 7, the number of medium risk practices decreased slightly to 27 and the number of low-risk practices increased to 183. Of those within the high-risk category at the start of the reporting period (24):
We have revised our inspection process to request policies, controls and procedures (PCPs) from practices in advance of an inspection rather than review the documentation on the day of the inspection. Inspectors interview key members of staff, usually owners, directors and MLROs. During the reporting period:
We are working with the two practices to achieve compliance.
Of practices rates as non-compliant:
The CLC’s Whistleblowing Policy enables the regulated community to make anonymous reports of suspected illegality, including money laundering concerns. There is a range of guidance and resources on breach reporting and making suspicious activity reports (SARs) in the AML Toolkit.