Increase in suspicious activity reports made by lawyers

NCA: SARs reform programme

The number of suspicious activity reports (SARs) made by lawyers rose last year but continues to represent just a tiny fraction of reports received by the National Crime Agency (NCA).

Solicitors made 2,052 SARs in 2021/22, a 20% increase on the previous year and almost exactly in line with the overall increase in SARs made during the year, which reached 901,255.

Licensed conveyancers made 83 reports (up 47%), barristers just four (down from nine) and other lawyers/legal businesses 724 (up 64%).

The figures were similar for defence against money laundering (DAML) SARs, which are made when a reporter has a suspicion that property they intend to deal with is in some way criminal, and that by dealing with it they risk committing one of the principal money laundering offences under the Proceeds of Crime Act 2002.

They do not commit one of those offences if they have received ‘appropriate consent’ from the UK Financial Intelligence Unit (UKFIU), which receives, processes and assesses SARs on behalf of the NCA.

Solicitors made 1,384 of these (19% more than in 2020/21), licensed conveyancers 61 (up 69%), and other lawyers/legal businesses 97 (up 31%). No barristers made such a report, compared to two in the previous year.

The UKFIU received a total of 83,300 DAML SARs in the year, a sharp fall on the 12 months before.

Solicitors also made 18 terrorist financing SARs, with a further six from other lawyers, out of a total of 1,651.

The NCA’s SARs annual report said that £306m was denied to suspected criminals as a result of DAML requests, more than double the £139m denied in 2020-21.

The agency stressed the vital role of SARs and said they have provided “increasingly important information” on money laundering linked to individuals and others sanctioned following Russia’s invasion of Ukraine.

Last year, it set up a Combatting Kleptocracy Cell (CKC), with a remit that includes the investigation of criminal sanctions evasion and high-end money laundering; the UKFIU has a team dedicated to it.

Under the SARs reform project, the UKFIU has adopted new methods of working and recruited more staff. It now has more than 150 and plans to reach 201 by the end of the next financial year.

Vince O’Brien, head of the UKFIU, said: “SARs are vital to the fight against money laundering, illicit finance and wider criminality.

“Major improvements to the UKFIU through the SARs reform project, including the establishment of dedicated analytical teams to support specific operational requirements such as those of the Combatting Kleptocracy Cell, and further enhancements rolling out over the next 24 months, will ensure we maximise the intelligence value derived from SARs, driving greater impact on economic and other crime, and helping to keep the UK public and businesses safe.”

Regulators also made SARs and the Solicitors Regulation Authority’s annual anti-money laundering report last year said it had made 20, relating to solicitors handling £149m of potentially criminal funds.

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