Prevention of Money Laundering

Compulsory Acceptance Procedure for Lawyers

The Act of 11 January 1993 for preventing the use of financial systems for money laundering and the financing of terrorism, ‘the Money Laundering Act’ for short, perhaps doesn’t mean much to you, but this law has implications not only for the relationship with your bank, your public notary or other financial adviser, but also for the relationship with your lawyer.

In implementation of the Money Laundering Act, the Order of Flemish Bars created a regulation to which all lawyers have had to adhere strictly since 30 December 2011. This regulation obliges each lawyer to conduct an acceptance procedure for each client and each dossier.

Because we feel it is important to inform you about this, you will find an explanation below.

We assess the nature of the task

We are obliged to find out from you the nature of the task you wish to give us, so that we can determine whether the Money Laundering Act is applicable.

If the task relates to specific matters categorised by the legislator as ‘vulnerable to money laundering’, the Money Laundering Act may be applicable, and we must perform an identity check. In concrete terms, this relates to the following tasks:
  • Acting on your behalf or for your account in financial transactions or real estate transactions.
  • Assisting you in the preparation or performance of one of the following transactions:
    i. Purchase or sale of properties or companies.
    ii. Managing monies, securities or other assets.
    iii. Opening or managing bank, savings or securities accounts.
    iv. Organising the contribution required for the constitution, operation or management of companies.
    v. Constitution, operation or management of companies, trusts, fiduciaries or similar legal constructions.

    • The Money Laundering Act does not apply to advice on determining your legal position, or the conducting, preparation or even prevention of legal proceedings, and no identity check is required for these.

      The Identification Process

      If the tasks to be entrusted to us do fall under the application of the Money Laundering Act, we are obliged to verify your identity, and that of the legal person who you may be representing. We will request a copy of your identity card, and, in the case of a company, an extract from the Crossroads Databank for Enterprises. We may also be obliged to ask you the origin of monies or assets.

      The Beneficiary Owner

      We are obliged to ascertain the beneficiary owners of the legal-person client. This means that we have to find out which natural persons are presumed to exercise control over the company. In this case, control means that they have a decisive influence on the appointment of the majority of the Board members and/or managers or on the orientation of the company.

      In practical terms, this means we have to ask the identity of all shareholders, who own at least 25% of the shares in the company. If, in turn, these shareholders are legal persons, extra information is required to establish the identity of the natural persons who are the shareholders of the underlying companies. It is necessary to follow the chain of consecutive owners - and the owners’ shareholders – until the final owner is identified. If this information requires adaptation during the course of our business relationship, we request that you pass this information on to us spontaneously.

      Are you obliged to provide the information we request?

      The law prohibits us from entering into a business relationship with you, and obliges us to terminate our provisional intervention, if we do not receive the requested information within two weeks of receipt of the first request to that effect. It is therefore important that you cooperate with the acceptance procedure.

      What do we do with your information?

      We guarantee that all of the information, which you entrust to us during our business relationship will be handled with complete discretion. The Money Laundering Act does not affect our duty of professional confidentiality. Therefore, we will only report identification information provided by you when Money Laundering legislation obliges us to do this.

      If you would like a copy of the identification fiche which we keep, please feel free to request this. It will be sent to you straight away.

      We trust that you will understand that we are obliged to follow this acceptance procedure, and presume that you will cooperate with it. You can be sure that this acceptance procedure will not affect our professional approach and efforts to help you.

      Please contact us any time for any further explanation.

      Crivits & Persyn