Reduction of the risks
The control of the handling of funds is organised by the CARPA according to the risk-based approach method recommended by the FATF.
The CARPA is the lawyers’ trusted partner in exercising their duty of vigilance : Its requests for information and communication of documents actively encourage lawyers to exercise it.
The CARPA establishes a permanent dialogue with lawyers to better understand the handling of funds subject to its control.
Pursuant to the AML-FT regulations, a lawyer has the same obligations of vigilance and declaration of suspicion whether or not he takes charge of the movements of funds triggered for the completion of a transaction to which he provides his assistance.
Refraining from taking charge of the financial flows incidental to the operations to which he contributes does not reduce his risk of being manipulated for money laundering purposes.
On the contrary, personally carrying out the pecuniary settlement discharged in a deed that he has drafted represents for the lawyer the best way to ensure its effectiveness and its consistency with the transaction.
This is part of the good practice of the duty of vigilance.
However, the handling of funds, by legal professionals, belonging to their clients is considered by the “guidance for a risk-base approach” published by the FATF as carrying risks (increased risk for a lawyer of being manipulated by being solicited for an apparently regular legal transaction, actually serving as a support for a fraudulent financial flow).
The mandatory intervention of the CARPA when a lawyer receives funds on behalf of his clients helps prevent and reduce this risk.
By means of the controls that it carries out using the risk-based approach and with the means of analysing operations at its disposal, the CARPA will decipher, in dialogue with the lawyer, the financial flow incidental to the legal transaction in which the latter participates and verify whether its compliance seems assured.
The intensity of the risk attached to the handling of funds carried out by the lawyer on behalf of his clients is thus very greatly reduced because the CARPA intervenes precisely to control this risk and allows, thanks to its controls and the means that it deploys to make them, the securing of the handling of funds.
Thanks to the CARPA system, the lawyer can ensure the reality of the financial flow incidental to a legal transaction while being protected against the risks associated with the financial flow itself, the compliance of which is controlled by CARPA.
Even though clients can decide to make the payments directs directly between each other through their banks without going through the CARPA, the Bar Associations encourage lawyers to ensure that the financial flows corresponding to the legal or judicial operations in which they participate are passed through the CARPA.
In this sense, the Director of TRACFIN was able to suggest during a conference in 2016 that an operation carried out by lawyers, without the funds pass through the CARPA, can potentially be considered to present a particular risk, precisely because it does not benefit from the guarantees of the CARPA. (Dalloz “The support of the CARPA for the protection of economic public order” p. 88).
Conversely, an operation processed through the CARPA presents additional guarantees of compliance due to the controls carried out under the authority of the Bar Association in the framework of the profession's self-regulation.