# AML UK Assistant

> Source: https://bryter.com/use-cases/anti-money-laundering-uk-tool/

The AML UK Assistant allows law firms to rapidly collate all information necessary to assess the potential risks of a business relationship with a prospective or existing client, pursuant to UK law.

This is often a costly and time-consuming process for law firms as practice groups must navigate through lengthy internal processes and policies, losing valuable time and revenue.  

Using the tool, users can quickly evaluate both new and existing clients through the entire client due diligence (CDD) process including:  

(a) determining whether Simplified Due Diligence (SDD) or Enhanced Due Diligence (EDD) is required;

(b) identity verification; and 

(c) issuing an automated written report and escalating any red flags.

All verification efforts are documented in a full audit trail. If desired, a report and dashboard are generated to monitor key factors such as risk type, transaction value or geographic location.

#### Background

In the UK, law firms are required to carry out client due diligence checks (CDD) when establishing a business relationship or entering into a high-value occasional transaction with a client in order to comply with [The Money Laundering Regulations 2017 (MLR 2017)](https://www.legislation.gov.uk/uksi/2017/692/made). The Law Society of England and Wales has in turn specified what this legislation means for law firms in detailed guidance – which outlines the Client Due Diligence (CDD) process and checks law firms are expected to carry out on their clients and transactions to comply with this legislation. 

#### Law Firms’ Responsibilities under MLR 17

Within the CDD process, law firms need to clearly document their risk assessment efforts, including the identification of the control structure and ownership of legal entities, verification of natural persons related to the ultimate beneficial owners, as well as source of wealth and funds in a transaction. In addition, law firms must also monitor clients continuously, establish procedures to report discrepancies in ownership information, and re-apply CDD measures when needed, all in a timely manner. 

#### **What are the penalties for failing to comply with MLR17?** 

When issuing penalties for non-compliance, the HM Revenue and Customs considers law firms’ actions in preventing and assessing potential breaches early on, pronouncing fines that are proportionate to failures. 

Given the breadth of law firms’ responsibilities under these regulations, there is plenty of room for non-compliance. In 2020 alone, the HMRC fined dozens of entities for faulty risk assessment procedures, lack of adequate policies, and poor due diligence—with penalties ranging from £ 4,000 pounds to well over £ 4 million. 

The biggest obstacle is the error-prone manual risk assessment, which is not only time-consuming, but can prevent law firms from acting timely, thus reducing its responsibility in AML breaches, and gaining a favorable stance before the regulatory bodies. 

With the AML UK Assistant, this process is automated. Our tool assesses prospective clients and the proposed transaction against various data sources such as sanctions lists. The user is guided through an interactive anti-money-laundering questionnaire, based on which the information necessary for performing all key CDD functions is gathered. If specific scenarios require it, the [**corporate legal**](https://bryter.com/team/corporate-legal/) department can be automatically notified, and an approval workflow can be triggered.