A customer risk assessment usually takes place when you first pick up a new customer. This is the part where you look at the client`s risk factors, such as where they are based, whether they are a politically exposed person, (in the case of a client company), their ownership structure, etc. There is a whole list of things to consider as part of this process, and the LSAG guidelines go into detail about that. The source of means and the source of wealth are two different things. Experience has shown that most companies focus on the source of the funds or on the question « Where does this money come from and how did they get it? » The lawyer will therefore generally check whether the funds come from the client and not from a third party. They will check whether it is reasonable for the customer to have this money available, so that, for example, they want to see proof of a person`s claim to an inheritance or loan. Sometimes the lawyer consoles himself with the fact that the funds come from a British bank, although this has been exposed by the directives as being even vaguely synonymous with safe money. British banks are not necessarily safe. Of all the AML trainings I`ve given or attended, by far the most valuable part is usually the group discussions on money laundering scenarios and practical examples. If I were an MLRO, I would definitely be directly all the staff in this section of the guide and I would test them for that. Can they choose red flags in certain fictitious scenarios? Do you have any horror stories or near misses that you can share with the rest of the company? It`s often a good idea to send a company-wide slap in the back to the person who discovered a red flag and forwarded it to the MLRO, whether or not it led to reports to authorities. Take a look at how companies are using Affinity`s flexible design tools to make it easier to create legal documents and correspondence The position seemed to have turned into a small SRA guide that disappeared almost as quickly as it appeared.
It was quite clear to say that sharing the cost of identity verification is acceptable, subject to transparency rules and cost information. I don`t know why this was removed – maybe they just don`t want to encourage companies to pass on overhead. Not the slightest flicker. [Update: The guidelines have since resurfaced on the RAS website]. And the last thing I noticed as I read those 200 pages of guidelines was the focus on enterprise-wide risk assessment. It is considered by our regulators to be the cornerstone of compliance, and everything else, your policies, procedures, due diligence, training, retention, everything flows from this document. It`s just that it`s probably easier for regulators to verify this too – it would be much more difficult to conduct a thorough review of the company`s compliance in practice. Therefore, if you`re taking one thing back from this session, it`s re-examining your enterprise-wide risk assessment, and if you don`t already have one, it should be an urgent priority! First, the guidelines have adopted a new approach, where they refer to all requirements as « shall, should or may ».
« Shall » means anything that is a direct requirement of the law. « Should » means everything the SRA expects of you, and you should have a good reason to deviate from it. « May » is a suggestion and advice of good practices. I just wanted to draw your attention to the new guidelines in this section on the source of wealth and the source of means. This is something that causes a lot of confusion and twisting of the hands in most real estate and transaction companies. Model and map legal and administrative processes and procedures. Automate the design, search, and management of task-related expenses. Ask for information when and where it is needed. This is different from a risk assessment of the issue, which usually takes place when you are taught a new business by a client.
You will look at risk factors, such as whether the case is in line with your know-your-client, where the parties are, what areas of law the case relates to, and so on. Again, the guide is useful for explaining what exactly a risk assessment should look like. Browse the best legal research content online or start your search from your topic. Link content and articles to questions to make searching easier. Maintain your internal search library in Affinity. Then I just want to spend some time with some observations about the guide itself. I don`t want it to appear as critical because the writers have clearly tried to make it as useful as possible, and honestly, I couldn`t have done better. But I think it`s worth pointing out a few problems with the document. The leading legal software solution that supports the productivity and growth of mid-sized law firms in the Pacific region and beyond. Every day, our customers rely on Affinity to meet the challenges of providing excellent customer service in a world where customer expectations and requirements are changing. This is a good time to check your registrations with the SRA.
All companies subject to money laundering regulations must be registered and authorized by the SRA for this activity. There are also some strange additional registration requirements that some companies overlook. One of them is the registration of all beneficial owners, managers and managers who wanted to shorten some smart Alec to BOOM. This means that every time a partner or director joins the firm, there is an obligation to register. You can do this through mySRA and there are many guides on the SRA website, but just for you to be aware of this, they need to receive a DBS exam as part of the notification. Anyway, let`s go back to the LSAG guidelines. Article 12 deals with « Other obligations ». This includes the new trust registration regime, which goes beyond the scope of this meeting, but will be particularly relevant for companies acting as professional trustees.