Reported by Rob Harkav

A FINTRAC bulletin highlights how the legal profession plays a major role in facilitating illicit transactions.

Legal professionals across Canada are increasingly at risk of being exploited by money launderers and financial criminals, according to a bulletin issued earlier this week by FINTRAC, Canada’s federal anti-money laundering authority. The bulletin was issued to alert banks and securities dealers, which are mandated to report certain transactions to the federal agency, about the rising dangers of illicit activities involving legal professionals.

“Members of the legal profession possess knowledge and skills that may be useful to criminal actors seeking to launder the proceeds of crime and/or evade economic sanctions,” the bulletin states, before going on to note that legal professionals often provide services, such as holding assets in trust for clients, creating corporations and trusts, facilitating real estate transactions and acting as corporate shareholders or directors, all of which have the potential to be exploited by criminal entities.

LAWYERS BEWARE

The agency warned that lawyers might find themselves acting as directors, officers, trustees, or even as owners or shareholders of companies, with their offices serving as the registered address for companies controlled by criminal actors. And while these lawyers are usually acting in good faith, the bulletin acknowledges that some legal professionals may be in cahoots with the crooks, stating: “Complicit legal professionals, as enablers and third-party money launderers separate from the proceeds-generating criminal activity, can offer a veneer of legitimacy and respectability to a financial transaction that may dissuade questioning or suspicion from financial institutions.”

Read full report: https://iclg.com/news/21744-canadian-regulator-warns-lawyers-over-money-laundering