From the Russian mafia to the Arab Spring

The number of law firms suspected of involvement in money laundering trebled last year, with some solicitors mixed up with the Russian mafia as well as “inappropriate transactions” following the Arab Spring, the Solicitors Regulation Authority (SRA) revealed yesterday.

In the latest update to its Risk Outlook, the SRA said money laundering was a “serious and increasing” risk facing the profession, naming these two particular issues to highlight the range of problems it is currently dealing with.

Reports of firms perpetrating or facilitating money laundering went up from 24 in 2012 to 68 in 2013, with a further 70-80 reports received about possible breaches of the Money Laundering Regulations, Proceeds of Crime Act and Terrorism Act.

The SRA identified some methods employed by money launderers targeting law firms, such as exploiting failures to conduct identity checks, disguising the true source of funds –  particularly where it concerns so-called politically exposed persons – infiltrating law firms, involving or exploiting more than one firm, and persuading a law firm to provide a banking facility.

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