Reported by: JUSTYNA GUDZOWSKA and JONATHAN M. WINER

International standards have evolved to include legal professionals among those required to help prevent and report cases of money laundering. But loopholes in US anti-money laundering laws continue to exempt many gatekeepers in the financial system. This includes certain lawyers and accountants, as well as company agents and trust providers, who help clients anonymize and hide dirty money.

America is nearly unique in this way.

The Establishing New Authorities for Businesses Laundering and Enabling Risks to Security Act—or ENABLERS Act—is an amendment to the annual National Defense Authorization Act. It would close these loopholes by authorizing the Treasury Department to require certain categories of financial service providers to adopt anti-money laundering safeguards. This would include filing a notice when they suspect that a transaction is being used to launder funds.

The ABA’s model ethics rules allow America’s lawyers to report criminal activity by clients to prevent a crime that would cause substantial injury to the financial interests or property of another, or to mitigate injury when the client has used the lawyer to do this. The ENABLERS Act is consistent with this framework.

Further, the act does not cover lawyers when they are engaged in civil or criminal defense activities, appropriately recognizing the need to ensure that suspicious activity reporting does not infringe on the rights of their clients or the functioning of our justice system.

Read full report: https://news.bloomberglaw.com/us-law-week/lawyers-should-be-key-reporters-in-anti-money-laundering-efforts