Money Laundering: The Ultimate Crime

Following the transposition of various European directives regarding money laundering, which may be used to finance international terrorism, lawyers are now faced with the obligation to report certain clients. An interview with William Feugère, an attorney specializing in this field.

William Feugère, an attorney at Campbell, Philippart, Laigo & Associés and a member of the Bar and the ACE (Association of Corporate Lawyers), specializes in money laundering issues. Like many other members of the Bar, he is concerned about the obligation imposed on lawyers to “report” potential money laundering operations to the authorities. This could threaten the integrity of attorney-client privilege, even if this “suspicious activity report” does not apply to information gathered during consultations legal or to activities related to legal proceedings.

What are your thoughts on the suspicious activity report?

William Feugère: This obligation creates a conflict with professional secrecy. Frankly, we cannot advise a client if they are unable to speak freely; they will no longer be able to place their full trust in us. This mandatory reporting requirement has, in fact, been strongly contested by the profession.

*But what, then, of the fight against money laundering?*

W. F.: We have prevention obligations: knowing our client, verifying their identity, collecting as much documentation as possible, and identifying the ultimate beneficial owner of a transaction, the source of funds, the capital holder, and so on. Our verification tools remain limited. While we can examine a company’s legal status via its Kbis registration, nominees may also be involved. We thought we could rely on banks, but bankers often cite banking secrecy to oppose us. We are also offered detection software designed to identify individuals on blacklists. However, it is highly likely that, in the case of a dubious financial scheme, someone with a clean criminal record will be recruited.

Money laundering has been elevated to an absolute offense, especially since it is no longer merely a consequence of another crime; it has become an autonomous offense. From now on, the perpetrator of the original crime can also be the perpetrator of the laundering, which was not the case previously. It is somewhat as if the fence were also the thief. Even though there are many prosecutions, it is, however, not a crime that results in very frequent convictions, with only 126 instances in 2006. It is often mentioned as a precaution at the very start of a case, out of fear of overlooking it.

*What should a lawyer do when faced with doubt regarding a client?*

W. F.: He must step down. This is especially true given that he could face prosecution for complicity in money laundering and may be subject to disciplinary action.

Which lawyers are most at risk?

W. F.: There are two categories: the junior lawyer lacking experience, and the one with no knowledge of criminal law. This highlights the importance of undergoing anti-money laundering training.