AML update – May 2025

The term ‘money laundering’ often evokes images of large sums of illicit money being funnelled through organized crime syndicates, such as the Russian mafia or Colombian cartels. However, the reality is far more commonplace and accessible. In fact, almost everyone, regardless of their role, has the potential to be involved in money laundering — making it crucial for all staff to stay consistently informed and vigilant about the latest strategies to prevent it.

The growing frustration among the SRA and other regulators over law firms’ failure to meet expectations has led to stricter requirements. Firms are now mandated to conduct comprehensive practice-wide risk assessments, implement thorough Customer Due Diligence (CDD) and Know Your Client (KYC) procedures with verification, and assess both client and matter risks, providing clear justifications for each decision made.

Furthermore, regulators are emphasising the importance of understanding the source of wealth and source of funds for each transaction. As a result, firms are operating under a more rigorous and closely monitored regime than ever before.

Topics covered include:

• The key question – what IS money laundering?
• What does it mean to be a ‘gatekeeper’?
• SRA sectoral reviews and warning notices
• What do we have to do to comply?
  • PWRAs
  • CDD; e-ID&V
  • CRAs
  • MRAs
• What do all the acronyms mean?
• The crucial importance of ongoing monitoring
• What are the consequences of us not complying?