Saturday 15th December 2018
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Comsure operates in:the UK, Jersey, Guernsey

An innocent loan or questionable funds?

Question

  • A client has instructed their financial service professional (e.g. solicitor) to purchase a property in Edinburgh which is to be funded partly by a building society mortgage, with the balance being provided by their parents who live in China.
  • The client’s parents are insisting on sending the funds for the balance directly to me, but I have been unable to obtain a proper explanation for the source of the funds.

Suspicion?

Answer

  • Section 328 of the Proceeds of Crime Act 2002 puts financial service professionals (e.g. solicitors) under a duty to report the activities of their client to the Serious Organised Crime Agency (SOCA) if the financial service professionals knows or suspects that the client is involved in an arrangement which facilitates the
    1. acquisition of criminal property;
    2. retention of criminal property;
    3. use or control of criminal property.
  • Examples of “arrangements” under s 328 would include the purchase of property funded with the proceeds of crime, and where there are reasonable grounds to suspect that part of the estate comprises money derived from tax evasion or benefit fraud.

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