Coming cleanThe recent issuing of a consultation paper on money laundering by the Financial Services Authority (FSA) underlines once more the government's intention to reduce financial crime.

The consultation will be of interest to those solicitors who are directly regulated by the FSA when the Financial Services and Markets Bill comes into force.

The European Commission is also concerned to reduce financial crime and before the end of next year, legislation will be in force enacting the provisions of the European Commission's Second Money Laundering Directive.

This will impose additional duties on most, if not all, solicitors by extending direct reporting obligations to professions such as accountants and lawyers which may be targeted by money launderers.

This initiative is part of a worldwide drive against organised crime and corruption, spearheaded in this instance by the member states of the European Union.Legislation on money laundering is currently of prime concern for the legal profession because it impacts on solicitors' daily performance of their duties.

The Law Society has created the money laundering and serious fraud task force to help solicitors meet both their current obligations and those that will arise under the new legislation and regulations.The Law Society is always conscious of its duty to protect and assist solicitors as they grapple with ever-increasing obligations imposed by new domestic and European legislation.

Solicitors must deal promptly and effectively with provisions introduced in the worldwide fight against organised crime, corruption, and money laundering.

While protecting our clients' interests, the profession must show the government that it is able to regulate itself and will not be the tool of those who seek to spread crime and corruption.While the task force recognises the need to assist the authorities in the prevention of money laundering, it is similarly conscious of the need for balance.

Solicitors cannot practise effectively and gain the trust so essential to their relationships with clients if faced with excessively intrusive and impractical obligations.

Members of the task force are currently in touch with the Law Society Brussels office and the government in order to monitor the draft directive and suggest suitable amendments.

For example, the present provisions of the draft directive may undermine the UK concept of lawyer/client privilege, and although the extension of reporting obligations is supposed to cover specific legal transactions, the wording of the relevant article is extremely wide, and needs more precise definition.The task force is comprised of solicitors with expertise in dealing with fraud and money laundering cases and client confidentiality, staff from the Law Society who specialise in giving relevant guidance, and a representative of the Office for the Supervision of Solicitors.

It meets at least four times a year, and more frequently if the need arises.

Between meetings, the work of the task force will continue in its liaison with the government, the European Commission, the FSA and the National Criminal Intelligence Service (NCIS).Solicitors should be aware of the present guidance given by the Law Society in the Guide to the Professional Conduct of Solicitors, 1999, eighth edition and the Money Laundering Information Pack.

Guidance on individual matters is available from the Society's professional ethics on department and also from the Society's practice advice service.

It is hoped to issue a revised and updated version of the guidance soon.Later in the year, in anticipation of the implementation of the Second Money Laundering Directive, the the money laundering task force hopes to provide all solicitors with fresh guidance and an information pack.

It will also liaise with the training committee and others on the impact of the directive on the training of trainee and qualified solicitors.

The task force wants to help the profession to keep up to date with the changes in the legislation in order to reduce the risk of prosecution for money laundering offences and it hopes the profession will keep it informed about problem areas in order that the task force can provide prompt assistance.Louise Delahunty is chairwoman of the Law Society's money laundering and serious fraud task force and a partner at London-based Peters & Peters