Anti-fraud authorities in the UK are gradually adopting a less ham-fisted approach to money laundering regulations as they become more attuned to legal practice, a leading white-collar crime specialist solicitor told the Chicago conference.

Louise Delahunty, former chairwoman of the Law Society's money laundering task force, maintained that the National Criminal Intelligence Service (NCIS) &150; which deals with money laundering reports from the legal profession &150; 'has finally begun to understand how solicitors deal with transactions and what solicitors do'.


According to Ms Delahunty, NCIS investigators are now taking a more sympathetic approach to the way in which the regulations are applied to solicitors' firms. Likewise, she said, law firms have been raising awareness of the regulations and training their staff accordingly. 'They are much more aware of risk prevention issues,' said Ms Delahunty.


She also raised concerns that anti-money laundering regulation in the EU was on the verge of going too far. The proposed Third Money Laundering Directive, she said, should possibly be put on hold until the full implications of the Second Directive had been fully digested.


Law Society President Kevin Martin said that while lawyers 'must ensure that the implementation of our pledge to eradicate money laundering is workable and balanced... the fear of terrorism and organised crime must not damage the ability of the lawyer to give confidential legal advice in the best interest of clients'.


George Hunter, vice-president of the Federation of Law Societies of Canada, explained that three lessons had emerged following successful court challenges to money laundering rules in his country.


He said: 'There is pervasive ignorance amongst citizens and politicians of the core values of the legal profession. Lawyers can be ostriches &150; they have to realise that they can't simply hide behind the curtain of independence. The courts have been very supportive; they are clearly concerned about protecting their own independence.'