“Solicitors are inherently nosey. They are always poking into people’s personal affairs for no good reason”.
Whilst that may well be true, it actually is not the reason that – particularly in conveyancing transactions – solicitors ask a lot of questions of their clients.
Imperial Law acts for a lot of clients in conveyancing matters where they never come into the office at all. This has been due to a move towards an electronically focused service that makes the process faster and remote, and ultimately more convenient all round.
The real answer to the barrage of questions? Money Laundering Regulations.
Many people will have heard of the process called laundering money. Illegal money is often called ‘dirty money’ and the expression explains how you wash the dirty money by buying a house and thereby creating clean money when you sell the house.
Because most conveyancing transactions take place through solicitors, the government decided that they would place an unusual requirement on solicitors and they decided to enforce that requirement by making solicitors guilty of crimes if they launder money either deliberately or recklessly.
In fact, solicitors have been sent to prison for just this.
The first thing that a solicitor has to do is check that the person instructing him is who they say they are. Obviously a criminal laundering money would want to do it in somebody else’s name. Bearing in mind that more and more people want to instruct solicitors remotely through electronic means this is not quite as easy as it seems.
Imperial Law acts for a lot of clients in conveyancing matters where they never come into the office at all because it is more convenient. If your solicitor requires you to bring in your ID for them to certify, please do so – the solicitor is only doing their job.
Having satisfied themselves that you are who you say you are, your solicitor must satisfy themselves that there is nothing suspicious in where the money is coming from. If the solicitor has suspicions that something is not right, then likely they will ask more questions.
For example: If you say your money is out of savings and you are working, but you earn £20,000 a year and live in London, then the solicitor will want to know how you managed to save this money up. Nobody should think that a solicitor is alleging that a client is dishonest; they are merely satisfying themselves as a result of the obligation put upon them by government.
Usually if you do not give satisfactory answers or if you refuse to give answers at all, all your solicitor needs to do is to refuse to act for you.
There is a more extreme example. If you put your solicitor in an impossible position such that they have to go ahead with the transaction and they are still suspicious about you then the solicitor must file a Suspicious Activity Report. If your solicitor does not report you to the the authorities then the solicitor commits a crime.
If, having reported you to the National Crime Agency, the solicitor goes and tells you that they have done it, then they commit a crime.
Innocent people should be patient with their solicitors and know why their solicitor is being nosey. It would even be a good idea to plan ahead if you are thinking about buying a house and work out how you are going to explain who you are and where the money came from.
The moral of the story? Criminals should not go to good solicitors to launder their money because they will get caught out!