The real threat lies in the potential to be caught by section 328 POCA which criminalises being ‘in an arrangement’ facilitating the acquisition, use, retention or control of criminal property by another.
‘Arrangement’ is interpreted broadly, capturing a professional’s advice, as well as planning and executing transactions.
However, there are limits.
For exposure, ‘criminal property’ must already exist. Concern that property could become criminal if further steps are taken is insufficient.
For instance, if a consultant fears her client’s disclosures suggest that a lucrative contract might be procured through bribery in the future and is asked for input on how best to structure an investment if that contract is secured, there is no section 328 risk because – unless more is known – criminal property (that is, proceeds generated by a corrupt contract) has not crystallised.
A complete defence to money laundering is available to consultants where a report is made to the authorities or where there is a ‘reasonable excuse’ for not making one.
A report requires careful consideration as it will inevitably prompt scrutiny of the client and could hold implications for the consultant’s work in other jurisdictions.
To protect a professional, the scope of their involvement must be accurately covered in the report.
It is clear that consultants must become familiar with the money laundering offences to avoid becoming ensnared in an arrangement to launder. Training is key.
Whilst Ministry of Justice figures record that convictions for section 328 (arrangement) hover at around 225 per year as opposed to over 530 each for sections 327 and 329 POCA (transferring and using criminal property), the number of criminal investigations into professionals, including management consultants, is unknown.
The dos Santos case suggests that despite sitting outside of the AML regulated sector, they are within the scope of money laundering scrutiny.
