The Legal Sector Affinity Group (LSAG) updated the UK AML guidance for the legal sector, which includes changes made to The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 through:
• The Money Laundering and Terrorist Financing (Amendment) Regulations 2019
• The Money Laundering and Terrorist Financing (Amendment) (EU Exit) Regulations 2020
Part 1 of this guidance has been published in draft form, pending approval by the Treasury. Part 2 will be published soon.
Notaries should review their own AML governance, policies, controls and procedures in light of the guidance, and update where necessary.
Key changes include:
• Revised, more granular contents section with embedded links to sections for ease of navigation
• Introduction of “Key AML Compliance Principles”
• Revised, updated and expanded AML Governance and Internal Controls sections.
• Fully revised and expanded Risk Assessment section (firm-wide, client and matter)
• Expanded guidance on understanding and evidencing source of funds and source of wealth
• A new section on technology – expanding on the requirement for firms to consider and understand the purposes and basis on which they are using AML- related technology (along with its underlying functionality) in order to use it effectively to mitigate risk
• Updated Training section
• Fully revised and updated Legal Professional Privilege section with new LPP/SAR reporting decision-making template (drafted by an independent expert in this niche area of law).