{"id":10729,"date":"2025-12-04T10:27:15","date_gmt":"2025-12-04T10:27:15","guid":{"rendered":"https:\/\/www.amlcc.com\/?p=10729"},"modified":"2025-12-01T10:27:47","modified_gmt":"2025-12-01T10:27:47","slug":"how-should-legal-firms-document-and-evidence-their-source-of-funds-checks","status":"publish","type":"post","link":"https:\/\/www.amlcc.com\/mv\/how-should-legal-firms-document-and-evidence-their-source-of-funds-checks\/","title":{"rendered":"How should legal firms document and evidence their source of funds checks?"},"content":{"rendered":"\n

How should legal firms document and evidence their source of funds checks?<\/h1>\n\n\n
\"Richard<\/div>
Richard Simms<\/span>

Director and Founder of AMLCC and AMLCC Consult<\/h3><\/div><\/div><\/div><\/div>\n\n\n
\"Legal<\/figure><\/div><\/div>\n\n\n\n
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Understanding and evidencing source of funds is a core part of due diligence for legal firms. LSAG guidance makes clear that it\u2019s not enough to know the money came from a particular account. You need to understand where the funds used in the matter originated, how the client obtained them and whether the explanation aligns with their profile.<\/p>\n\n\n\n

For firms regulated under the Money Laundering Regulations, this isn\u2019t simply a question you ask. It\u2019s something you must be able to document and verify to an appropriate standard, with an audit trail that shows how you reached your conclusion. That\u2019s what regulators expect and it\u2019s what protects the firm when a file is reviewed.<\/p>\n\n\n\n

What source of funds means in legal work<\/strong><\/h2>\n\n\n\n

LSAG<\/a> guidance emphasises that source of funds is more than knowing the money came from a UK bank account. You need to understand both the origin of the money used in the transaction and how the client obtained it. <\/p>\n\n\n\n

To identify source of funds you need to collect information such as:<\/p>\n\n\n\n