When I was President of the Law Society of England and Wales, I went for lunch with the Batonnier of the Paris Bar in his magnificent flat on the Isle de France overlooking Notre Dame.  This particular head of the Paris Bar, the most prestigious in France, had been elected on a platform of opposition to the implementation of the 3rd Money Laundering Directive shortly due to come into effect.

During the course of the lunch, Monsieur Bationnier became a little personal when he picked up his folk and pointed in my direction.  ‘You Vichy’ he said in broken English referring to the collaborative French regime set up to appease the Nazis during their occupation in the Second World War.  His ire was not so much personal as directed at the Law Society which was in the process of preparing documentation for Solicitors on how the Directive was to be applied. Why on earth were we co-operating with the authorities when this might sometimes mean that we had to shop our own clients to the Police? He had vowed that French lawyers would never do so.

The fact is that solicitors in the UK handle huge volumes of money submitted by their clients to fund house purchases, business transactions and in relation to the handling of estates. In France, lawyers do not normally have client accounts and their role in business and property transactions is much more peripheral than in the UK. As practitioners, we have always accepted that we have a responsibility to co-operate with the authorities to prevent money laundering occurring in the work that we do.

As my practises Money Laundering Reporting Officer I have a difficult role to perform. On the one hand we have to advise clients about our duties under the fourth money Laundering Directive and the Proceeds of Crime Legislation. We also have a duty to keep our clients affairs confidential – we have the protection of Legal Professional Privilege. This means we do not have to tell third parties what advice we may have given our clients in relation to their legal affairs. That is their business and nobody else’s.

However, I have a duty to report suspicious activity to the National Crime Agency and my practise will commit a criminal offence if we are involved in a criminal transaction. I describe this as walking a tightrope between maintaining professional duties of client confidentiality whilst ensuring that we comply with our legal requirements to prevent money laundering.

So, what does this mean for our clients? Firstly we have to establish that our clients are who they say they are by production of passport or other original documentation and evidence of address. Secondly, we have to check the source of the funds that the client is paying us to undertake our work. We have to satisfy ourselves that there are no suspicious circumstances leading us to believe that the funds are tainted with criminality. This often means questioning what our clients do, how they acquired savings and how they can afford to do what they are doing. We tell clients upfront about these requirements, however some may find it intrusive and untrusting. This is just not the case, it is completely procedural.

We try and carry out these checks as soon as we can at the beginning of the work. We will then be in a position to advise the clients about our duties under money laundering legislation and thereby avoid getting involved if there are suspicions. We will then give clients a choice, we can cease acting or we can proceed but we may consider a report to the National Crime Agency as this is essential to protect our own position.

It is a tribute to our profession that we continue to operate in this difficult regime, balancing the two sides of giving an excellent professional service to our clients whilst honouring our duties to society to ensure that criminals do not gain from their unlawful activities. At Jackson Lees group we are up for the challenge!