The inter-governmental Financial Action Task Force (FATF) has released a guidance document, Risk-based Approach for Legal Professionals, to help with management and design of effective measures for managing Anti-Money Laundering and Countering Funding of Terrorism (AML/CFT) risks.
The guidance highlights the need for a sound assessment of the AML/CFT risks that legal professionals face so that the policies, procedures and initial and ongoing client due diligence (CDD) measures can mitigate these risks.
It says this risk-based approach is central to the effective implementation of the FATF Recommendations to fight money laundering and terrorist financing.
The guidance is aimed at legal professionals, countries and their competent authorities, including supervisors of the legal profession, as well as practitioners that have legal professionals as customers.
The FATF says it developed the non-binding guidance with significant input from the legal profession, including through a public consultation in March 2019, to ensure that it reflects their practical expertise and good practices. It replaces the version of 2008 and brings it in line with the current FATF Recommendations.
The Financial Action Task Force was established in 1989 by its member jurisdictions. Its objectives are to set standards and promote effective implementation of legal, regulatory and operational measures for combating money laundering, terrorist financing and other related threats to the integrity of the international finance system. New Zealand is a member.