What’s the Proceeds of Crime Act 2002?

The Proceeds of Crime Act 2002 (POCA) is a central part of the UK’s anti-money laundering (AML) framework. It sets out what’s meant by criminal property, defines money laundering offences and establishes when suspicions must be reported.

The Act applies across sectors (including accountancy, legal services, property businesses and HVDs) and provides the legal foundation that sits beneath the UK’s Money Laundering Regulations 2017 (as amended) (MLRs). While the MLRs focus on systems, controls and prevention, POCA deals with how criminal property is identified, handled and reported once it comes into view.

POCA was introduced to give law enforcement clearer powers to recover the proceeds of crime and to create consistency around how criminal property is treated. It clarifies expectations around reporting and establishes the legal context for suspicious activity reporting.

What POCA means by criminal property

Under POCA, criminal property is property that:

• represents a benefit from criminal conduct, either directly or indirectly; and
• is known or suspected to represent the proceeds of crime.

The definition is intentionally broad. Criminal conduct includes any offence in the UK, as well as conduct overseas that would be an offence if it took place here. This means criminal property can arise from activities such as fraud, tax evasion, bribery or sanctions breaches.

Property is not limited to cash. It can include money held in accounts, land or buildings, shares, cryptoassets or other items of value.

The main money laundering offences in POCA

POCA sets out three core money laundering offences that are relevant to professional services work.

1. Concealing, disguising or converting criminal property

This offence covers activity that hides the origin of criminal property or changes its form. Examples include moving funds between accounts, converting cash into assets or obscuring the source of money through transactions or opaque structures.

2. Entering into arrangements involving criminal property

This applies where someone becomes involved in an arrangement that helps another person acquire, retain, use or control criminal property.

For advisers, this is often the most relevant offence. It does not require personal benefit and can apply where professional services support the continued use or control of property that is known or suspected to be criminal.

3. Acquisition, use or possession of criminal property

This offence relates to acquiring, using or possessing criminal property. In a professional context, it can be relevant where fees are paid from funds suspected to represent the proceeds of crime.

Reporting obligations under POCA

One of the most practical effects of POCA is the requirement to report suspicions of money laundering. 

If, in the course of business in the regulated sector, a person knows or suspects, or has reasonable grounds to know or suspect, that another person is engaged in money laundering, a disclosure must be made.

In practice, this means:

• staff must raise concerns internally with the MLRO; and
• the MLRO must consider whether a Suspicious Activity Report (SAR) should be submitted to the National Crime Agency.

The duty to report is triggered by suspicion rather than certainty. POCA does not require proof or confirmation that a crime has taken place.

Understanding suspicion in practice

Suspicion is not defined in precise terms but it sits between speculation and certainty. It arises where something does not sit comfortably with what is known about a client, their funds or a transaction.

For regulated professionals, this reinforces the importance of professional judgement. If information gathered through due diligence or during your ongoing business relationship does not align with the client’s profile, the issue should be considered and, where appropriate, escalated.

Clear internal reporting processes and documented decision-making are essential, particularly if a decision not to report is later reviewed.

Tipping off and confidentiality

POCA also includes offences relating to tipping off. Once a SAR has been made, or where an investigation is contemplated, information must not be disclosed if doing so could prejudice an investigation.

This is why SARs are confidential and why care is needed in communications with clients when delays or additional checks arise.

What POCA means for day-to-day AML work

For most firms, POCA does not require a separate process. Its requirements are met through effective AML systems that:

• encourage staff to question inconsistencies;
• provide clear internal SAR reporting routes;
• support proportionate escalation; and
• record how decisions are reached.

The emphasis is not on making assumptions about criminality but on recognising when information does not align and responding appropriately.

Final thoughts

The Proceeds of Crime Act 2002 underpins the UK’s approach to tackling money laundering. For regulated professionals, it provides the legal context for suspicious activity reporting and reinforces the importance of judgement, escalation and documentation.

When your AML framework allows you to identify concerns, explain your reasoning and evidence your decisions, POCA compliance becomes part of a coherent, practical approach to AML risk management rather than a separate legal hurdle.