Money Laundering
Do you ever worry about the source of some of the fees that your school is paid? Do you ever have doubts about accepting large cash payments from parents or others?
At a time when many schools are competing for new markets, these are understandable worries for bursars and governors, and more and more schools are beginning to think seriously about adopting a more rigorous approach to the risks of becoming embroiled in money laundering.
The UK's anti-money laundering regime is targeted mainly at businesses such as banks, solicitors and accountants who routinely handle money for their clients. Schools are not regulated businesses, and in most cases will only receive money in return for the education that they provide, and so the regime may seem to have little direct effect on schools.
Having said that, school governors have a duty to take appropriate steps to avoid their school being involved in financial crime, and it is easy to appreciate the reputational risk of being seen to have accepted proceeds of crime, even without the school and its staff having broken the law. And it is possible for an unregulated business such as a school to fall foul of the Proceeds of Crime Act 2002 by receiving what the law refers to as 'criminal property', this being property that constitutes or represents a person's benefit from criminal conduct, including conduct overseas that would be a crime if it happened here.
There are some technical defences but, when you consider the potential reputational issues about receiving school fees from a suspected criminal in addition to the legal risk, you may wonder what practical steps you can take to ensure that you stay on the right side of the law.
Recognising that some schools want to go the extra mile to steer clear of financial crime, we have developed an anti-money laundering policy that, in a modest and pragmatic way, mirrors some of the mechanisms that banks and other regulated businesses use. The policy envisages staff training in the key legal issues, measures for undertaking customer due diligence, for record keeping and for the reporting of suspicions of money laundering through a ‘Nominated Officer’ who oversees the implementation of the policy.
If this is something that you might find helpful, please get in touch and we would be very happy to discuss how we can support you with tailored policies and procedures.