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Review of legal sector finds law firms leaving door open to corrupt wealth entering Britain

 2nd March 2018, London – A new review carried out by the Solicitors Regulation Authority (SRA) has called on law firms to do more to tackle money laundering, revealing two thirds of firms examined failing to have an organisation-wide risk assessment in place and serious concerns about more than 10 per cent of those surveyed.

Transparency International UK (TI-UK) research has previously raised concerns that law firms are failing to identify and report on suspicious activity. In 2015/16 the sector produced less than 3,500 reports of suspicious activity – under one per cent of all reports submitted that year. Last year TI-UK found 766 UK companies involved in 52 international corruption scandals worth up to £80 billion – and official documents show that individuals and firms from the UK’s legal sector aided criminals in setting up these structures.

The review is one of many which should be conducted by regulators across the business sector. It illustrates the wide range of approaches taken by the UK’s various anti-money laundering supervisors. TI-UK has identified significant problems with this system, in which the 25 supervisors offering an inconsistent approach to applying the money laundering regulations. There is a lack of transparency around enforcement and when sanctions are given, they do not represent a credible deterrent against wrongdoing.

Duncan Hames, Director of Policy at Transparency International UK, said:

“When corrupt individuals are looking to move stolen wealth into the UK it will very often be with the help of law firms – either knowingly or unwittingly. Overseas corruption is enabled by professionals in the UK some of whom all too easily turn a blind eye to wealth that is clearly suspicious.”

“We welcome the work the SRA have done in conducting this review, and their openness in publishing the results.  It presents worrying conclusions about the attitude of some law firms towards the serious risk of money laundering. Findings such as these warrant increasing the intensity and number of assessments of firms in this sector, and demonstrate the need for clear and credible sanctions to deter others from neglecting their money-laundering defences.” 

“The legal sector is not alone in this fight, the supervisors of other sectors such as banking, accounting and estate agents should also be carrying out these reviews on a regular basis and publishing the results. This would result in a better informed private sector which in turn will create a more hostile environment for dirty money entering the UK.”

***ENDS***

Contact:

Dominic Kavakeb
020 3096 7695
079 6456 0340
dominic.kavakeb@transparency.org.uk

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Read 132 times Last modified on Friday, 2 March 2018 17:21

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