Aspects of the legal profession are identified as being attractive to criminals wanting to launder the proceeds of crime and to finance terrorism.

Why does the legal profession have AML/CFT obligations?

Legal practitioners and conveyancers provide services that operate as a gateway to property and financial markets, financial institutions and other regulated professionals.

These ‘gatekeepers’ provide financial and business services that can be abused to disguise beneficial ownership, conceal the origins and purposes of financial transactions, facilitate tax evasion and, ultimately, launder the proceeds of crime. Operating through or behind a professional adviser can provide a veneer of legitimacy to criminal activity.

Legal practitioners can be used to create complex (but legal) structures that can create distance between criminals and their illicit wealth. Conveyancers facilitate a process that allows for the transfer of ownership of property, a high-value asset that provides ideal opportunities for laundering large volumes of illicit funds.

What are the ML/TF risks faced by the legal profession?

The Money Laundering and Terrorist Financing (ML/TF) risks associated with the legal profession include:

  • Obscuring ultimate ownership through complex layers and legal entity structures
  • Evading tax and exploiting known tax shelters
  • Evading regulatory controls
  • Providing a veneer of legitimacy to criminal activity
  • Creating distance between criminal entities and their illicit income or wealth by using complex business and corporate structures
  • Avoiding the detection and confiscation of assets, and hindering law enforcement investigations

Legal practitioners must ensure they conduct a comprehensive ML/TF risk assessment to identify, assess, mitigate and manage ML/TF risk exposures. This is a critical first step in AML/CFT compliance.

What services are covered by AML/CFT obligations?

These are the services offered by lawyers and conveyancers that are covered by AML/CFT obligations:

  • Acting as a formation agent of legal persons or legal arrangements
  • Acting as, or arranging for a person to act as, a nominee director or nominee shareholder or trustee in relation to legal persons or legal arrangements
  • Providing a registered office or a business address, a correspondence address, or an administrative address for a company, or a partnership, or for any other legal person or arrangement
  • Managing client funds (other than sums paid as fees for professional services), accounts, securities, or other assets
  • Engaging in a transaction on behalf of any person in relation to the buying, transferring, or selling of a business or legal person (for example, a company) and any other legal arrangement
  • Engaging in a transaction on behalf of a customer in relation to creating, operating, and managing a legal person (for example, a company) and any other legal arrangement
  • Engaging in or giving instructions on behalf of a customer to another person for any conveyancing to affect the grant, sale, or purchase or any other disposal or acquisition of real estate or an interest in land
  • The transfer of a beneficial interest in land or other real property
    If you offer or provide one or more of the above services, your business will be subject to AML/CFT obligations.
What is a risk based AML/CFT regime?

The AML/CFT regime is risk based, which means that your responses to the AML/CFT obligations placed upon you should be risk-based. 

A risk-based AML/CFT regime requires that you understand and address the Money Laundering and Terrorism Financing (ML/TF) risks associated with the legal services you offer.

You must then design, implement and maintain systems, procedures and controls that are proportionate to your ML/TF risks.

How can Initialism help?

Initialism are the AML/CFT experts, so you don’t have to be.

With over 30 years of expert knowledge and real world experience our AML/CFT compliance solutions will to help you navigate your legal and regulatory requirements so that your business complies with its AML/CFT obligations in the fastest and most cost-effective way.

Initialism has a range of AML/CFT solutions to support becoming AML/CFT compliant and maintaining compliance:

Our solutions allow you to tailor support based on your capacity, experience and budget.

AML/CFT compliance solutions for your
legal practice

From self-guided to fully dedicated support, our AML/CFT compliance solutions for legal professionals draw on unparalleled expertise, knowledge and real-world experience. Click below to discover which of our AML/CFT compliance solutions is right for your legal practice.
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  • Includes a 12 month licence to New Zealand's online leading AML/CFT compliance solution
  • From $6,995*

*$NZD excl. GST

UNSURE OF THE BEST SOLUTION FOR YOUR PRACTICE?

Why chose Initialism?

UNPARALELLED EXPERTISE

Our expertise covers all AML/CFT disciplines and brings unique perspectives, approaches and solutions to the AML/CFT challenges faced by the legal profession

IN-DEPTH INDUSTRY KNOWLEDGE

Our AML/CFT compliance knowledge includes working with legal firms and we understand what compliance means for your legal practice

REAL WORLD PERSPECTIVES

We have experience in delivering workable AML/CFT compliance to legal practices, each with their own unique challenges

OVER 30 YEARS EXPERIENCE

Our knowledge and expertise has been hard earned and comes from working in the area of AML/CFT for many decades

SOLUTIONS THAT WORK

We have experience providing tried and tested AML/CFT solutions, regardless of the size and complexity of your legal practice

TAILORED FOR YOUR BUSINESS

Our AML/CFT compliance solutions are flexible and can be tailored to your capacity, experience and budget

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NEED OTHER AML/CFT COMPLIANCE SERVICES?

Together with our AML/CFT compliance solutions we offer a range of additional services to help legal and conveyancing practices including AML/CFT Independent Audit and AML/CFT Training.