SOCPA 2005 [.pdf, 1.1 MB].
Money Laundering Legislation – POCA 2002
The Proceeds of Crime Act (“the Act”) received Royal Assent on the 24th July 2002 and came into force on 24th February 2003. The Act is split into a number of different Parts. Part VII of the Act deals with money laundering. The Act expanded, reformed and consolidated the UK’s criminal money laundering offences. Most of the offences under the Act apply to all individuals and businesses in the UK. However, some of the offences apply only to those doing business in the “regulated sector”. The regulated sector is defined in Schedule 9 of the Act.
The Money Laundering Regulations 2003 (“the Regulations”) came into force on 1 March 2004. In general terms, these Regulations impose requirements on those conducting “relevant business” to have systems in place to obtain evidence of the identity of their clients, keep records, train staff, and make internal reports.
The Money Laundering Offences (POCA) 2002
The three principal money laundering offences are contained in sections 327, 328 and 329 of the Act. These offences are triable either in a Magistrates' Court or in the Crown Court and are punishable on conviction on indictment in the Crown Court by a maximum of 14 years imprisonment and/or a fine.
Section 327 - An offence is committed if a person conceals, disguises, converts, transfers or removes from the jurisdiction property which is, or represents, the proceeds of crime which the person knows or suspects represents the proceeds of crime.
Section 328 - An offence is committed when a person enters into or becomes concerned in an arrangement which he knows or suspects will facilitate another person to acquire, retain, use or control criminal property and the person knows or suspects that the property is criminal property.
Section 329 - An offence is committed when a person acquires, uses or has possession of property which he knows or suspects represents the proceeds of crime.
All three of the principal money laundering offences contain certain defences. For example, in the case of each of these offences it is a defence to have made an authorised disclosure to, and obtain appropriate consent from, the authorities before doing the act which would constitute the offence (see sections 335 and 338 of the Act).
Section 340(3) – Property is criminal property which constitutes a person’s benefit from criminal conduct or it represents such a benefit (in whole or part and whether directly or indirectly) and the person knows or suspects that it constitutes or represents such a benefit. Property is all property, whether it is situated in the UK or abroad.
Persons and businesses in the “Regulated Sector” or conducting “Relevant Business”
Part 1 of Schedule 9 of the Act sets out the types of activity that would bring a business within the regulated sector.
Regulation 2(2) of the Regulations defines “relevant business”.
Section 330 and 331 - create an obligation on those persons in the regulated sector to report their suspicion or knowledge of another person’s money laundering to SOCA. Failure to report is a criminal offence.
If your business is not within the regulated sector then the provisions of s.330 and s.331 of the Act will not apply to you. All other criminal offences contained within Part VII of the Act apply to those inside and outside the regulated sector.