AML: don't miss the 26 June deadline
New anti-money laundering regulations require all Scottish law firms not able to claim exemption to go through a new registration process by 26 June, or risk sanctions including closure
An ever-increasing focus on anti-money laundering (AML) controls within the legal profession has seen the introduction of new AML requirements for both the Law Society of Scotland and Scottish solicitors.
The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 stipulate that the Society, as an HM Treasury-appointed AML supervisor, is required to collect, retain and provide anti-money laundering related information about its members. The Society will shortly be introducing a new compulsory annual AML certificate for all firms to complete and return, in order for it to collect the required information from members. The rollout of this online form will be advised as soon as possible.
The Society also reminds members of the requirement to complete a firm-level risk assessment (reg 18) – a new template is available on the Society’s website (www.lawscot.org.uk/amlinformationandresources) to assist members in this process.
All Scottish law firms to register
In addition to the above, reg 26 requires the Society to approve all beneficial owners, managers and officers of Scottish law firms through a new registration process by 26 June 2018.
These requirements are mandatory for all law firms – with non-compliance potentially resulting in criminal penalties for individuals, or the closure of the firm – and the Society has contacted all firms to update them on this new process.
How do I register?
An online registration portal has been set up that can be accessed through the members’ section of the Society’s website – go to the home page to sign in. Applications MUST be submitted by 26 June 2018. If no application is made by this date, the individual will NOT be able to continue as a beneficial owner, manager or officer of the firm, and may be liable for criminal penalties.
As part of this process, your firm must also submit current (up to six months old) basic Disclosure Scotland certificates for all beneficial owners (partners), managers and officers of the firm (for definitions please see the FAQs section on the Society’s website). Firms are advised to apply for these disclosures immediately, in order that they are available to upload to the portal prior to the closing date of 26 June.
If your firm has 10 or more partners and you wish to appoint a designated person to prepare the information for review and submission by the MLRO, you must send their details, including date of birth, current contact details and (if a solicitor) their solicitor registration number as soon as possible to AMLregistrations@lawscot.org.uk
There are exemptions for firms who carry out solely non-regulated work, which takes them out of the scope of the regulations. The Society has contacted firms it believes fit this profile directly (generally criminal law practitioners). If, however, you believe your firm is outwith the scope having read reg 12 of the regulations, please email AMLregistrations@lawscot.org.uk to notify the Society and request an exemption declaration.
Find out more
Both as a responsible AML supervisor and as a membership organisation, the Society is committed to the education and support of its members in preventing the Scottish legal system being used to launder the proceeds of crime.
There are regular AML updates posted on its website, along with a wealth of information on how to comply. The Society has also published a helpful FAQ on the new registration process for approval and what to do before submitting your application.
The Society intends to recover AML supervisory costs (e.g. the OPBAS fee and staff costs associated with AML supervision) from partners and directors of practice units doing work within the scope of the money laundering requirements. More detailed information (including how this will affect the accounts fee) will be published in due course.
For more information see www.lawscot.org.uk/amlregistrationfaq, or contact AMLregistrations@lawscot.org.uk if you have any queries at this stage.