Navigating the Upcoming AML Changes: A Guide for Criminal Defence Lawyers

The article Navigating the Upcoming AML Changes: A Guide for Criminal Defence Lawyers is written by Doogue + George Defence Lawyers.

Doogue + George are experts in criminal law and have been involved in thousands of criminal matters and defended clients in hundreds of jury trials and thousands of other criminal cases. Our experienced lawyers have unparalleled experience in criminal law.
 

The proposed start date for several of the key reforms is 31 March 2026.

This might feel like we have a lot of time to prepare. But let’s be honest: the year is already flying by, and it’s crucial we don’t wait until the last minute to get our practices ready.

So, what does this mean?

For criminal defence lawyers, tightening your Anti-Money Laundering (AML) processes is paramount. If your practice operates under a corporate structure, training directors and key staff members on AML issues is crucial. And for those in partnerships or unincorporated practices, make sure your partners and practice managers are well-informed.

Many criminal lawyers already have some form of a system in place to address Know Your Client (KYC) and AML concerns.

However, if you’re unfamiliar with these concepts (and the acronyms), now is the time to begin your training.

• Know Your Client (KYC) refers to the processes that organisations use to verify the identity of their clients, the goal being to prevent illicit activities. At Doogue + George, our process is relatively straightforward. Most of our clients come with a charge sheet, which means their identities have been verified by the police. In addition, we also require a photo of each of our clients.
• Anti-Money Laundering (AML) refers to the policies and procedures that organisations implement to prevent, detect, and report money laundering activities. They are particularly important when handling large amounts of cash. Accepting cash payments can trigger significant red flags, and we must design robust systems to address these concerns proactively.

Creating Your AML Compliance System

Here are some actionable steps you can take:

• Appoint an AML Compliance Officer: I know that sounds over the top, but you may as well do it now and get used to the idea. You probably have a fire warden so why not have that person double up as your AML officer?
• Seek external advice: Once you have set up a system, seek advice from someone with expertise in that area and get them to determine whether your system is fit for purpose. There are a lot of commercial lawyers out there who live and breathe compliance monitoring so why not reach out to one of them?
• Identify red flags: Criminal defence lawyers also need to be vigilant about cases that may raise red flags. Cases involving the supply or trafficking of drugs (especially commercial quantities), fraud, stealing, and anything involving forfeiture and confiscation applications are high-risk and warrant scrutiny. Discussing these cases with your compliance officer before accepting payment is a practice worth looking into.
• Be wary of third-party funding: One of the main areas of concern for criminal defence lawyers is where third parties fund cases. This is a flashing orange light issue that you can’t ignore. You’ll also need to be prepared for the obligation to file a suspicious matter report, but let’s save that topic for another day!

How to safe-guard against risk when it comes to payment

One way of ameliorating risk when it comes to payment is to NOT be paid by the client but to receive payment from an associated third party who is able to establish the source of the money to your satisfaction.

At Doogue + George, in cases that warrant it, we get an associated third party to sign the fees agreement. They also have the same rights regarding disputing bills.

Another mechanism for mitigating risk is to get an affidavit from the payer and a copy of their bank statements showing where the money has come from. This is often enough to allay any concerns that we might have.

At Doogue + George we also have a checklist which our lawyers are required to action when AML issues are flagged—whether from a client or a third party. This checklist then goes to one of our directors for review.

It’s a straightforward process that adds another layer of security which also serves as an AML guide for criminal defence lawyers.

Keep in mind that systems can break down, so it’s essential to stay vigilant. Always check for AML issues as files come across your desk—better safe than sorry!

Please don’t hesitate to reach out on +61 3 9670 5111.
 
 
 
Date Published: 7 November 2024