Legal Practice :- When Anti-Money Laundering (AML) & Combating The Financing Of Terrorism (CFT) Compliance Obligations Arise For Legal Practitioners Under The New Rules Of Professional Conduct (RPC) For Legal Practitioners In Nigeria
The New Rules Of Professional Conduct (RPC) for legal practitioners in Nigeria, due to take effect from the 1st of January,2024, was released with a new set of ethical considerations, particularly in the areas of Anti-Money Laundering & Combating The Financing Of Terrorism (AML/ CFT) compliance obligations that will be deemed to have become pending in certain situations and which now brings lawyers ever closer to the classification of Designated Non-Financial Businesses/Professionals (DNFBPs) which falls under the new Money-Laundering(Prohibition) Act of Nigeria.
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– Objectives of the new RPC in AML/CFT considerations as they affect legal practitioners.
– When the obligations of lawyers in this regard will arise.
What are the objectives of the new RPC regarding AML/CFT Compliance Requirements imposed on legal practitioners?
– To promote adherence to the rule of law.
– To promote the duty of confidentiality and the client/lawyer privilege toward their clients and provide yardsticks for the overall ethics and best practices of the profession to ensure that legal services are not being misused by criminals or for legal practitioners to be unwittingly involved in money laundering and terrorism financing.
– Internally self-regulate members of the legal profession and where applicable, recommend lawyers in breach to appropriate disciplinary authorities in accordance with relevant provisions of the Legal Practitioners Act.
What is the application scope of the new RPC?
– The RPC shall apply to all lawyers whose names appear on the roll and as described in Section 2 of the Legal Practitioners Act.
When do the AML/CFT Compliance obligations of legal practitioners arise as prescribed in the new RPC?
– The reporting and compliance obligation of a lawyer shall arise when –
- a) Acting as a formation agent of legal persons.
b). Acting as , or arranging for another person (proxy) to act as a director or secretary of a company, a partner of a partnership, or similar position in relation to other legal persons.
c). Providing a registered office, business address or accommodation, correspondence or administrative address for a company, a partnership or any other legal person or arrangement.
d). Acting or arranging for another person to act as trustees of an express trust or performing the equivalent function for another form of legal arrangement.
When will AML/CFT Compliance obligations be deemed not applicable to lawyers under the RPC?
– This obligation shall not apply to a legal practitioner who only provides notary services or merely certifies the execution or authority of a power of attorney or another instrument(not primarily prepared by the legal practitioner) which may facilitate :
a). Buying & selling of real property or business entities.
b). Managing money belonging to clients, securities and other assets.
c). Opening of management of bank, savings or securities accounts.
d). Organization of contributions necessary for the creation, operation or management of companies.
e). Creation, operation or management of trusts, companies, foundation or similar structures.
What are the record keeping obligations imposed on lawyers concerning general practice operations and regarding AML/CFT compliance?
– A lawyer shall maintain for a minimum of 5 years, an up-to-date record of necessary information of his clients that will aid the identification of such client & to keep or process such information in accordance with relevant data protection and client/professional privilege laws and rules applicable in Nigeria.