UK Law Commission Proposes Reforms to Suspicious Activity Reports for Money Laundering
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Key takeaways:
- The UK Law Commission has published a wide-ranging consultation paper outlining provisional reform proposals to the UK’s Suspicious Activity Report (SAR) regime for reporting suspected money laundering to the authorities. This could lead to significant changes to the UK’s anti-money laundering laws.
- Some of the proposed reforms to the SAR regime should reduce the compliance burden on banks and other financial institutions that routinely file SARs. However, it is not obvious that the changes will address the fundamental causes of the high number of SARs that are currently submitted which are of little practical intelligence value.
- Notable proposals include modifications to the test of suspicion required for filing a SAR, allowing banks to handle mixed criminal and legitimate funds in some circumstances, and the potential introduction of a corporate criminal offence of failure to ensure the reporting of suspected money laundering.