NCJ Number
154269
Journal
Solicitors Journal Dated: (July 10, 1992) Pages: 672-673,682
Date Published
1992
Length
3 pages
Annotation
This article examines a new European Community (EC) directive aimed at combatting international money laundering and considers the use of the solicitor and the Law Society.
Abstract
Money laundering involves a process whereby what was visibly tainted (capital obtained as a direct results of criminality) is cleansed (capital is freed of its associations with crime). The definition of money laundering adopted by the EC builds upon that stated in the United Nationals Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances, the Vienna Convention. The directive obliges member states to implement a scheme that ensures financial and credit institutions know their customers, keep certain records for a set period of time, examine suspicious transactions, report all suspicious transactions to the authorities, and assist the authorities with any consequent investigation. Furthermore, financial and credit institutions are required to ensure that the contents of the directive are made known to all members of staff, who must be trained to be alert to and detect money laundering. This scheme is ancillary to the criminalization of money laundering. Under the directive, all clients who enter into a business relationship with the solicitor for the first time, or conduct a transaction through the solicitor for the first time, or conduct a transaction through the solicitor of greater than 15,000 ECU must now be presumed money launderers until such time as they provide the solicitor with evidence of identity. The directive assumes that member states will create an agency that is responsible for the inspection of the various institutions subject to the directive, so as to ensure compliance.