October 01, 2014

New lawyer’s guide focuses on money laundering detection and prevention

The ABA, International Bar Association (IBA) and Council of Bars and Law Societies of Europe (CCBE) released a joint publication titled “A Lawyer’s Guide to Detecting and Preventing Money Laundering” during the IBA conference in Tokyo Oct. 22.

“Money laundering and terrorist financing represent serious threats to life and society and result in violence, fuel further criminal activity, and threaten the foundations of the rule of law (in its broadest sense),” according to the guide. “While bar associations around the world play a key role in educating the legal profession, the onus remains on individual lawyers and on law firms to ensure that they are aware of and comply with their anti-money laundering (AML) obligations,” the guide said.

The Lawyer’s Guide provides practical tips to help lawyers avoid inadvertently participating in money laundering activities and to help them comply with their legal obligations to fight money laundering where they apply. The guide, which does not impose any obligations on a lawyer, includes the following information: a summary of certain international and national sources of AML obligations; discussion of the vulnerabilities of the legal profession to misuse by criminals involved in money laundering; a discussion of the risk-based approach to detecting red flags, red flag indicators of money laundering and how to respond to them; and case studies illustrating how red flags may arise in the context of providing legal advice.               

Kevin L. Shepherd, chair of the ABA Task Force on Gatekeeper Regulation and the Profession, led the ABA working group that participated in developing the new guide in conjunction with similar working groups established by the IBA and CCBE.

The ABA has played a leading role in fighting money laundering and terrorist financing for many years and supports a “risk-based” approach to addressing these problems, rather than more burdensome “rules-based” legislation and regulations that could undermine the attorney-client privilege, the confidential lawyer-client relationship and traditional state court regulation and oversight of the legal profession. Toward that end, the ABA developed the “Voluntary Good Practices Guidance for Lawyers to Detect and Combat Money Laundering and Terrorist Financing” in 2010, and the association continues to urge state and local bars to encourage their members to follow the guidance.

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