A person does not commit an offence if they report the event before it occurs. Therefore someone being asked to hold criminal property on behalf of another, or to carry out some activity which they believe might assist with money laundering, must report this knowledge to the appropriate authorities as soon as possible.
In the regulated sector, individuals must also report situations where they have reasonable grounds to suspect that money laundering is happening. Therefore, a person could be prosecuted if they negligently fail to identify and report suspicious activity.
It is possible for a person to defend their failure to report something about which they should have been suspicious by claiming that they had not received adequate training in identifying suspicious circumstances.
As a result, rules exist which require firms, amongst other things, to have anti-money laundering procedures in place and to carry out appropriate training.
Firms in the regulated sector must appoint a Money Laundering Reporting Officer (MLRO) who is responsible for receiving suspicious transaction reports from staff, considering the threat and passing the report on to the the National Crime Agency – NCA (formally to the Serious Organised Crime Agency – SOCA) where necessary.
Once someone has passed on their suspicions to their MLRO they are relieved of further responsibility. The MLRO must use a standard form for reporting suspicious transactions and circumstances to the NCA. Where it has been decided that a report should be passed on, it is an offence for the MLRO not to do this as soon as possible.
The penalty for failing to report money laundering, or a reasonable suspicion that money laundering activity is taking place, is imprisonment of up to five years, a fine or both.