Reset to Today

To access the FCA Handbook Archive choose a date between 1 January 2001 and 31 December 2004.

Content Options:

Add to favourites

View Options:

More Resources:

External link Handbook Publications

Alternative versions

  1. Point in time
    2005-05-31

ML 4.1 Internal reporting

ML 4.1.1G

This section deals with the reporting to the firm's MLRO or a person authorised by the Director General of NCIS of knowledge or suspicions within the relevant firm about money laundering.2

ML 4.1.2R
  1. (1)

    A relevant firm must take reasonable steps to ensure that any member of staff who handles, or is managerially responsible for handling, transactions which may involve money laundering makes a report promptly to the MLRO or a person authorised by the Director General of NCIS , within the same firm or group, if he:

    1. (a)

      knows or suspects; or

    2. (b)

      has reasonable grounds to know or suspect;

    that a person is engaged in money laundering.21

  2. (2)

    The steps to be taken under (1) include establishing and maintaining arrangements for disciplining any member of staff who fails, without reasonable excuse, to make a report of the kind envisaged in this section.

ML 4.1.3G

A relevant firm may wish to set up internal systems that allow its staff to consult with their line manager before sending a report to the MLRO. If a relevant firm sets up such systems, it should ensure that they are not used to prevent reports reaching the MLRO whenever staff have stated that they have knowledge or suspicion that a transaction may involve money laundering.

ML 4.1.4R
  1. (1)

    The duty in ML 4.1.2 R (Internal reporting) does not apply where the relevant firm is a professional legal adviser and the knowledge or suspicion or the reasonable grounds for knowing or suspecting are based on information or other matter which came to it in privileged circumstances.

  2. (2)

    Information or other matter comes to a professional legal adviser in privileged circumstances if it is communicated or given to the adviser:

    1. (a)

      by (or by a representative of) its client in connection with the giving by the adviser of legal advice to the client; or

    2. (b)

      by (or by a representative of) a person seeking legal advice from the adviser; or

    3. (c)

      by a person in connection with legal proceedings or contemplated legal proceedings.

  3. (3)

    The privileged circumstances in (2) do not apply to information or other matter which is communicated or given with a view to furthering a criminal purpose or in contravention of a provision of the regulatory system.

  4. (4)

    "Professional legal adviser" includes any person in whose hands information or other matter may come in privileged circumstances.2