Money laundering: from failure to absurdity

Abstract

Purpose – The purpose of this paper is to examine the UK law relating to money laundering in the aftermath of the three statutory instruments that came into effect in December 2007. In particular the suitability and impact of the law is considered. Design/methodology/approach – The method adopted is to analyse the current content of the law and consider whether the approach utilised in its drafting will result in the aims behind the law being achieved. Findings – The result of this analysis is to conclude that the law as drafted is not designed in a way that can be effectively applied and that in addition the entire approach is flawed. In particular there are five key areas where problems arise: there is a requirement to report suspicion or knowledge of criminal offences or proposed terrorist acts but not other proposed criminal offences; the requirement to report only relates to information that comes into the reporter’s possession in the course of their trade or profession; the 2007 Regulations create requirements that many of those on whom they are imposed will not be able to effectively apply; the new s.333A appears to limit the offence of tipping off to the regulated sector but will not work as drafted; and in addition there are clear human rights issues associated with the overall regime. Originality/value – This original and topical paper explains the law as it now exists and provides analysis of its impact and undoubted failings.