National Risk Assessment (NRA) of Money Laundering and Terrorist Financing

21 July, 2025

On 17 July 2025 the new National Risk Assessment (NRA) of Money Laundering and Terrorist Financing was published on the government website and is available here. The key points for CLC practices are:

• Legal service providers (LSPs): The NRA 2025 continues to assess the money laundering risk as being high for LSPs and states: “Criminals are often drawn to legal service providers due to the veneer of legitimacy legal professionals can offer due to perceptions of the sector’s integrity.” (paragraph 5.193) The following services are at the “highest risk” of exploitation by those seeking to launder money:

1. Conveyancing: The key conclusion in the 2025 NRA is that the risk that conveyancing services are abused for money laundering purposes remains high. The NRA goes on to state: “…It often involves legal service professionals who are essential for most property purchase[s] in the UK. The purchase of property in the UK is attractive to criminals who seek to launder large sums of illicit funds in a single transaction, both to disguise their wealth and to benefit from the use or ownership.” (Paragraph 5.202)
2. Trust and Company Service Providers (TCSPs): The NRA continues to assess the offering of TCSP services as high risk (paragraph 5.204). Some of the key messages in the NRA are: “…The use of complex structures and legal arrangements, use of virtual office addresses not connected to beneficial owners, and the combination of services involving intermediaries and nominees, can facilitate anonymity. This anonymity is attractive to criminals looking to distance the criminal origin of the funds.” (paragraph 5.225)
3. Misuse of client accounts: The NRA continues to assess the risk of client accounts being used for money laundering purposes to be high risk. The NRA states: “…they can be misused by criminals to both move illicit funds and to provide a veil of legitimacy to the proceeds of crime.” (paragraph 5.205)

Other areas of interest for CLC practices:

• Cryptocurrency: There is now a large section of the NRA devoted to cryptoasset threats and one of the key messages is: “The risk of money laundering through cryptoassets has increased significantly since 2020 with cryptoassets increasingly appearing in money laundering intelligence over this period.” The NRA also notes that “…Whilst Bitcoin remains an attractive cryptoasset for illicit finance and serious and organised crime (SOC), stablecoins such as Tether are now most commonly used to launder money.” (paragraph 3.61)
• Sanctions evasion: The NRA highlights a growing “convergence” between sanctions evasion, money laundering and kleptocracy. They identify that, “…Sanctioned entities and individuals aim to conceal the links to their funds by leveraging existing money laundering networks…” (paragraph 3.3).
• Electronic Money institutions (EMIs) and payment service providers (PSPs): The NRA 2025, for the first time, assesses the money laundering risk as being “high” in relation to these kinds of firms, increasing from medium in 2020. As you are aware, these organisations offer alternatives to traditional banking models by offering “non-bank payment services”.The NRA states: “The rapid scaling of the sector since 2020, increased complexity and diversification of services, has contributed to the sector’s attractiveness for criminals, with increased options to manage and launder funds cross border.” (paragraph 5.64) Some examples of EMIs are: Revolut and Paypal.

CLC practices must take the NRA into account when conducting their own assessments both at the practice wide and client/matter level – this will be checked when the CLC conducts monitoring and inspection visits. We would strongly remind practices that in relation to sanctions the CLC recently published an advisory note which contains a comprehensive update: here.

Next steps: The CLC will now proceed to update its own sectoral risk assessment (the current version can be found here). We will send out a link to the new assessment when it is completed and as always we will be looking specifically at the services that CLC practices offer.