Documents

Risk Based Approach Guidance for Legal Professionals

In October 2008, the FATF adopted Guidance on the Risk-Based Approach (RBA) to Combating Money Laundering and Terrorist Financing for Legal Professionals. This Guidance was developed by the FATF in close consultation with representatives of the legal and notarial profession. This guidance supports development of a common understanding of what the RBA involves, outlines high-levels principles involved in applying the RBA, and indicates good practice for governments and legal professionals in the design and implementation of an effective RBA.

In June 2007, the FATF adopted Guidance on the Risk-Based Approach to Combating Money Laundering and Terrorist Financing: High Level Principles and Procedures, which includes guidance for public authorities and guidance for financial institutions. This was the culmination of extensive consultation between private and public sector members of an Electronic Advisory Group (EAG) established by the FATF.

In addition to financial institutions, the FATF Recommendations also cover a number of designated non-financial businesses and professions (DNFBPs). At its June 2007 meeting, the FATF’s Working Group on Evaluation and Implementation (WGEI) endorsed a proposal to convene a meeting of the representatives from the DNFBPs to assess the possibility of developing Guidance on the risk-based approach for their sectors, using the same structure and style as the completed Guidance for financial institutions.

The EAG continued work until this Guidance for legal professionals was presented to the WGEI. After further international consultation with both public and private sectors, the FATF adopted this Guidance at its October 2008 Plenary. Guidance for each of the other DNFBP sectors is being published separately.Purpose of the Guidance

The purpose of this Guidance is to:

  • Support the development of a common understanding of what the risk-based approach involves.
  • Outline the high-level principles involved in applying the risk-based approach.
  • Indicate good practice in the design and implementation of an effective risk-based approach.