August 2005

A number of changes to the requirements to report money laundering under the Proceeds of Crime Act 2002 (POCA) were brought into force with effect from 1st July 2005. The Serious Organised Crime and Police Act 2005 (SOCA), which introduced the changes, was one of the measures pushed through Parliament before it was dissolved for the election. The Bill contained a number of other more controversial provisions, including the creation of the Serious Organised Crime Agency, new powers for law enforcement, an incitement to racial hatred offence, and restrictions on public demonstrations near Parliament. These overshadowed the amendments to POCA which received little debate.

The relevant aspects of SOCA which affect the requirements to report money laundering are as follows:

  1. A new defence to the main money laundering offences and the failure to report offences where the conduct generating criminal property took place overseas and was lawful there. This change is not yet in force.

  2. A new defence to the failure to report offences where the person making the report has no information to identify the money launderer or the whereabouts of the criminal property.

  3. A new offence of failing to report on the required form, and other changes to reporting procedures.

  4. A new threshold amount below which deposit-taking institutions need not seek consent to operate accounts.

  5. A change to the legal professional privilege defence for professional legal advisers.
  6. Herbert Smith Document

Peter Burrell and his colleagues at Herbert Smith LLP have produced an excellent document which provides a commentary on the implications of these changes. Herbert Smith LLP is a legal practice with a 1,100-lawyer network across Europe and Asia. See the link opposite to view a copy of the document.

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