AML / CTF / CPF / ROE & Sanctions 2023 Quiz

Quiz for the webinar hosted by For Legal.

https://www.formediagroup.co.uk/forlegal/aml-ctf-cpf-roe-sanctions

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* 1. Respondent Details

First Name

Last Name

Company Name

Job Title

Email Address

Phone Number

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* 2. To avoid missing something that may be reportable, and to ensure that all staff are as vigilant as they can be, it is suggested that:

The MLRO go on frequent training courses and email staff with key points to watch

Team meetings and discussions be held regularly to discuss the key things to watch for in the coming period

The MLCO hold a monthly briefing meeting for fee-earners

A regular ‘points to note’ feature be displayed on the firm’s website

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* 3. The Legal Sector Affinity Group guidance (LSAG) suggests that Source of Wealth enquiries should be made and evidence kept in every case. This means:

Asking the client about their lifestyle and recording it on the Client Risk Assessment

Obtaining 6 months of bank statements and keeping them on the Matter Risk Assessment

Asking the client about their lifestyle and recording it on the Matter Risk Assessment

Obtaining 6 months of bank statements and keeping them on the Client Risk Assessment

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* 4. The AML (Amendment) Regulations 2019 suggest that electronic search tools can be treated as independent and reliable sources of evidence of identity, provided:

It is always used in conjunction with one piece of physical evidence produced by the client

It is always used in conjunction with two pieces of physical evidence produced by the client

The supplier can provide us with an assurance that the person claiming a particular identity is in fact that person

The cost cannot be passed on to the client

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* 5. You are instructed on behalf of a client (XMB Limited) which wants you to buy property in the UK with funds that are coming from an offshore trust registered in Guernsey. You should:

Check the sanctions lists AND fully check the background to XMB Ltd and its true beneficial owners before deciding on next steps

Proceed as Guernsey is not a suspicious territory

Cease to act as Guernsey is a suspicious territory

Proceed as it does nor sound or seem suspicious

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* 6. On a file review you discover that 6 years ago you acted for a Russian company (Proptec) that was a subsidiary of another company in the purchase of a corporate apartment in London. Under the Economic Crime (Transparency & Enforcement) Act 2022 you should:

Do nothing, as it is a closed matter

Report it to NCA as it was clearly a suspicious transaction

Encourage your client to declare the beneficial ownership of Proptec

Ensure that the ownership of the ultimate holding company has been declared under the Register of Overseas Entities

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* 7. A fee-earner tells her firm’s MLRO about a concern she has with a new instruction from an old client. The client is an Albanian company and is wanting to sell some property in London and needs someone to certify the identity of their company’s beneficial owners for the purposes of the Register of Overseas Entities. The MLRO should:

Tell the fee-earner that is would be against SRA and Law Society policy to act as a certifying authority for the purposes of the ROE

Refer the matter immediately to the MLCO

Tell the fee-earner that this would be acceptable as the verification of the identity would already have been carried out for the purposes of the firm’s CDD processes on their last instruction

Report the matter to the NCA forthwith

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* 8. On an audit of the firm’s systems and processes, it transpires that many staff are deploying their own version of the agreed firm policy on CDD procedures. The MLRO is notified of this by the independent auditor. She should:

Do nothing, provided everyone is making the correct assessments

Immediately reprimand the staff who are not following firm policy

Ensure that a review is carried out forthwith and adjustments made to the firm’s systems, to ensure consistency of approach

Report the firm’s non-compliance to the NCA

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* 9. A fee-earner sends an email to her firm’s MLRO indicating a concern she has with a new instruction from a new client. The client is wanting to buy property abroad through an offshore trust of which he is the alleged beneficiary. This is the first time this has happened. The MLRO should:

Ask the fee-earner to put her concerns in a formal internal report to him

Refer the matter immediately to the MLCO

Ask the fee-earner to investigate the background and all aspects of the instructions fully and report back to him further

Report the matter to the NCA forthwith

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* 10. On instruction by an individual client in a regulated matter, what steps should you be taking in addition to identifying the client?

Verify their ID independently

Verify their ID independently and ask about their source of funds

Verify their ID independently and ask about their source of wealth and funds

Verify their ID independently and ask about their beneficial owners, their source of wealth and funds

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* 11. As part of your CDD steps on a UK-registered corporate client you find that the company is ultimately wholly-owned by another company registered in Panama. That company is registered with bearer shares only. What should you do now?

You will need evidence of the identity of the individual owners of the bearer shares in the Panamanian company, however this may be obtained

You only need to be satisfied as to the management and ownership
structures of the UK-registered business

You only need be satisfied as to the identity of two of the directors of the UK-registered business

You should accept evidence of the Panamanian company and stop enquiries there as any further evidence will not be forthcoming

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* 12. You are instructed by (and have completed the identification and verification of) a 28-year-old client who is seeking to buy her first house with a deposit of £50,000 which, she says, is earnt from savings and is currently in her own bank account. She has a clerical job with the local opticians. What should you do regarding the funds which she claims to have available?

No further enquiries are required as she has given an adequate explanation

You should enquire further as to the source of the client’s wealth as it would appear unusual for her to have such a sum in savings

You should obtain 6-months’ worth of bank statements to verify the money is where she says it is

You should cease to act and report the matter to the firm’s MLRO

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* 13. In a routine conveyancing matter you have some concerns about the origins of the client’s contribution to the purchase price and report the matter to the National Crime Agency. They acknowledge receipt and say that they will get back to your firm within 2 days with their response. That afternoon the estate agent rings your firm and demands of the person who answers the phone a full explanation as to why exchange of contracts has not yet occurred as planned. What should the staff member say?

The staff-member should explain the position to the estate agent and request that they do not say anything to anyone else

The staff-member should refer the agent’s call to the firm’s MLRO

The staff member should terminate the incoming call

The staff-member must say nothing that might have the effect of tipping off the suspect