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Money laundering reporting – does the buck stop with you?

For those of you who have watched the popular Netflix program Ozark, hearing the term ‘money laundering’ may conjure images of bundles of ‘dirty’ cash being put through a washer/dryer to clean it with the aim of making it appear that it has come from a legitimate source.

Money laundering may conjure images of bundles of ‘dirty’ cash being put through a washer/dryer.
Money laundering may conjure images of bundles of ‘dirty’ cash being put through a washer/dryer.

However, those in the ‘regulated sector’ (for example, banking, accountancy, or those offering legal or financial services) will be all too aware of the difficulties and pressures they face in identifying and combating money laundering to ensure compliance with the obligations created by the governing legislation, ie the Proceeds of Crime Act (POCA) 2002 and the possible criminal sanctions that may follow if they fail to discharge them.

One such example is through Section 330 of the 2002 Act, which governs the treatment of individuals working within the regulated sector who fail to disclose suspected money laundering to a ‘nominated officer’ (who may also be known as a money laundering reporting officer) or the National Crime Agency.

It is with interest to note that the Crown Prosecution Service (CPS) have published updated guidance on June 2 on how it prosecutes ‘standalone failure to disclose’ cases of known or suspected money laundering, under Section 330 of the 2002 Act.

What’s new?

The new guidance offers a further incentive for professionals to report knowledge or suspicions of money laundering to the relevant authority. Now, an individual can be prosecuted under Section 330 whether or not an offence of money laundering has actually been proven to have taken place.

This creates an obligation for any individual who receives information leading them to suspect a money laundering offence to report it, irrespective of whether or not there is sufficient evidence to substantiate it.

What does this mean for the future?

It is unclear why the CPS has decided to update its guidance on this point, given that prosecutions under Section 330 have, at least up until now, been exceedingly rare. Those working in the regulated sector already tend to report suspicions to a nominated officer without substantive evidence of an offence.

It is perhaps thought that the update indicates an increased appetite on the part of the CPS to take action against those who facilitate or enable criminal activity but we will have to watch this space with interest.

For more information on suspected money laundering offences or for any other criminal or regulatory matters, contact our team on 0344 967 2505 or visit woodfines.co.uk.

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