Abstract
The attorney’s trust account is an enticing prospect for criminals seeking ways to launder money acquired illegally, and the attorney whose trust account is abused in this way stands to be branded and punished as a money launderer. The overall aim of the article is to identify the dangers which money launderers pose to attorneys and to highlight the need for vigilance in the face of these dangers. It analyses the anti-money laundering reporting obligations imposed on attorneys by the Financial Intelligence Centre Act and considers impact of these obligations upon the attorney-client relationship. Some of the ways in which a law practice may become implicated in the placement, layering and integration stages of the money laundering process are discussed, and cases which deal with attorneys’ involvement in money laundering schemes are presented.
Highlights
In South Africa there is something almost sacrosanct about an attorney's trust account
It telescopes the stages of the money laundering process: placement is achieved by the dirty money being deposited into the attorney's trust account; layering occurs when the attorney disburses the dirty money to fund the various aspects of the property transaction; and integration is effected when the property has been transferred from seller to purchaser and becomes a legitimate asset at the disposal of the money launderer
The money laundering industry is predatory, and its members are on the lookout always for new avenues through which to legitimise their black products
Summary
In South Africa there is something almost sacrosanct about an attorney's trust account. The attorney's trust account is especially attractive to persons who or organisations which seek to launder money.[5] It is akin to a one-stop laundromat: money goes in dirty on one side, wends its way through an unbroken cleaning cycle and emerges spotless on the other side. The methods in which an attorney's trust account may be transformed into a money laundering device are manifold. Reference to four such methods must suffice here. This article is concerned with the abuse of the attorney's trust account as a conduit for laundering money and with the transformation thereby of the attorney into a money launderer. This essay may be comprehended as a caveat jurisconsultus of sorts, alerting attorneys to the dangers of money laundering and warning them of the need to prevent their trust accounts being captured by money launderers
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