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Money Laundering

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The Court of Appeal has handed down its crucial judgment in Bowman v Fels, on the controversial issue of the extent to which the Proceeds of Crime Act 2002 prohibits solicitors and barristers from engaging in litigation where they suspect the client (or the other side) of dealing with the proceeds of crime without first notifying NCIS.

This is of importance to all lawyers, and has particular relevance to employment lawyers when dealing with (arguable) illegality points or litigation over tax issues.

The Court of Appeal has held:

  • the Act is not intended to cover the ordinary conduct of litigation by legal professionals, including any step taken in litigation from the issue of proceedings and the securing of injunctive relief through to final disposal by judgment (para. 83)
  • the Act does not override legal professional privilege. If information is the subject of legal professional privilege, there is no obligation to disclose it to NCIS (paras. 83-89)
  • likewise, the Act does not override the obligation to keep confidential documents disclosed through the disclosure process (para. 90)
  • nor does it cover consensual settlements within litigation (para 99). But is does cover consensual arrangements independent of litigation (para. 101).

Bowman v Fels