SA law societies sign MoUs with Financial Intelligence Centre

The law societies acknowledged the importance of concluding the MoUs: "The MoUs are a significant step for the legal profession in South Africa.

"The provincial law societies - which are the regulatory bodies for attorneys - have now taken on the additional mantle of supervisory bodies in terms of the FIC Act, which increases their regulatory functions over attorneys. This is indicative of a commitment to professionalism and ethical behaviour among practising attorneys," says David Bekker, co-chairperson of the Law Society of South Africa and chairperson of its FIC Committee.

Obligations of accountable institutions

From the perspective of compliance with the FIC Act, a key requirement for practising attorneys is the obligation to register with the FIC in terms of section 43B of the FIC Act.

"We believe that approximately 10,000 attorneys firms should be registered with the FIC," says Murray Michell, director of the FIC. "We urge practising attorneys who are not yet registered with the FIC to do so."

Accountable institutions have other obligations as well, such as the obligation to report suspicious and unusual transactions (STRs) to the FIC. The reporting of STRs is geared towards drawing the FIC's attention to financial transactions that may suggest the possibility of criminal activity, so that further investigation can take place if necessary.

"We are aware that attorneys are particularly vulnerable to the possibility of being used by criminals," Michell explains. "Trust accounts are an obvious target for the laundering of money. Attorneys could, for example, find themselves unwittingly facilitating criminal behaviour when involved in the transfer of a property bought with illicit funds."

Enhanced oversight for greater accountability

Any business activity that appears to be suspicious should similarly be reported. So, too, when a practising attorney suspects that his or her client's property may be linked to terrorist activities.

A number of other compliance obligations apply to practising attorneys - the appointment of a compliance officer, training of staff, and the duty to keep record of transactions.

Bekker notes: "In their roles as supervisory bodies, the provincial law societies will undertake to train practitioners, and keep them up to date regarding communication from the FIC. The law societies will also undertake to carry out regular random inspections of attorneys."

"We are thrilled to welcome the law societies into our fold," concludes Michell. "The FIC has concluded 12 MoUs with other supervisory bodies. We look forward to fruitful collaboration in the years ahead."

For more information, go to www.fic.gov.za.