Solicitors should be aware of the list of money laundering red flags in Chapter 9 of the Guidance Notes. You may also find it useful to review the following international documents about risk and red flags particular to the legal profession:

• June 2013 - The FATF 2013 Report on Money Laundering and Terrorist Financing Vulnerabilities of Legal Professionals

• October 2014 - The IBA/CCBE/ABA 'A Lawyer’s Guide to Detecting and Preventing Money Laundering'

Sham Litigation

It's also important for solicitors to be mindful of sham litigation red flags. Typically, a solicitor is contacted by a new client, usually based outside the country, seeking to recover funds owed to them from an Irish-based company or a former partner. The new client instructs the solicitor in a litigation matter which places the legal service outside AML compliance duties. The instruction may be litigation for breach of contract or recovery of funds agreed in a family law settlement. Fraudulent supporting documentation, for example copy contracts/settlement agreements etc, and intricate background stories are often provided. Sometimes, the solicitor receives a sum of money from the third party and is instructed to deduct their fees and pass the remaining funds on to the client without ever having provided a legal service.

The Law Society frequently issues warnings to solicitors about potential money laundering scams involving fraudulent litigation/debt collection schemes. See the following notices which highlight the red flags which occur within this type of money laundering typology:

• May 2016
• October 2013
• November 2011