Under the Proceeds of Crime Act 2002 (POCA), solicitors have a duty to report knowledge or suspicion of money laundering, provided that knowledge or suspicion has not been formed as a result of information received in legally professionally privileged circumstances.


If knowledge or suspicion arises from a confidential communication made for the purpose of seeking or providing legal advice (advice privilege), or for the sole or dominant purpose of proceedings (litigation privilege), that communication may have taken place in legally privileged circumstances. As such, there will be no duty to make a report, although solicitors are always advised to speak to their firms' nominated officers about any concerns. The legal professional privilege offence does not apply if the communication is made with a criminal intent.



When giving legal advice in an ancillary relief case, or acting in ancillary relief proceedings, it may be necessary and appropriate for a solicitor to advise a client that, in light of the solicitor's knowledge or suspicion, continuing with the division of matrimonial assets could result in the committing of a money laundering offence.



That offence could be committed unless an authorised disclosure is made to the National Criminal Intelligence Service (NCIS) and the appropriate consent is received from NCIS.



However, solicitors must take care to avoid committing the offences of tipping off or prejudicing an investigation. The Law Society's pilot guidance on money laundering (www.lawsociety.org.uk) gives further advice on these offences, and the exceptions to them.



- The Law Society's professional ethics team provides a confidential advice service for solicitors and their staff about professional conduct rules including money laundering (tel: 0870 606 2577, from 11am to 1pm and 2 to 4pm).