Updated 14 July 2026
Short Answer:– UK Money Laundering checks were brought in throughout the 1990s as part of international law (agreements with other countries and institutions) as part of the war on the illegal drugs trade. The idea is to check the ID of the person paying money to another, and to see if they are ‘sanctioned’. Your solicitor is expected to identify and flag up suspicious transactions and payments to Money Laundering officers and government organisations to assist in stopping and catching criminals.
If the solicitor fails to flag up suspicious transactions, they can be prosecuted for that failure, even if there is no actual prosecution or criminal involved. These checks are often mixed up (deliberately) with ID checks on you, but the other purpose is to ensure your solicitor pays your money to you, not an imposter which prevents a ‘breach of trust’. The purpose is therefore two fold.
Updated 08 July 2026
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Why you need to get your ID checked by an expert like a solicitor.
This includes, the personal and financial information you must give to your solicitor, why you must provide this information if you want legal advice, what happens to it afterwards and who can read it. Although the intention is not to be sensationalist..… click here to contact us if you questions about ID and electronic ID checks
This is the stuff that solicitors do not like to talk about. It is the second job they do which goes unseen. Sure, your solicitor can make a will, buy a house, help you sign a lease, give advice, maybe go to court if you’ve really cocked something up. In exchange for a reasonable fee the solicitors will do what you ask, within reason.
However, it will not have escaped your attention that your solicitor will demand ID documents and details about your finances before they act – mainly your savings and your income if they’re holding your money in their client account for any reason. The consideration for your advice is both your money and your data.
Do you ever stop and think why? Other than it’s ‘the law’ (because it is) and those are the Money Laundering Regulations.
The truth is that your solicitor to a certain extent must ‘spy’ on you – with your consent of course – to gather very specific kinds of information about you – information about your identity and your finances. And keep it in your file for as long as necessary – 6 to 7 years minimum.
However, it’s an uncomfortable truth and, if the solicitor has a reasonable suspicion, judged objectively, that you may be ‘doing crimes’ by syphoning ill gotten money through your bank accounts then the solicitor must file reports about it – with the government. And if the solicitor doesn’t do that, they get prosecuted too, in very serious way.
We don’t like to talk about it, or bring up the subject so as not to offend you or drive you away. If fact, telling you about it in the wrong circumstances may actually be an offence called ‘tipping off’, itself also a crime by the solicitor with yet more serious consequences. All the information you give to you solicitor sits on your file which will be kept for usually six or seven years, or more in certain circumstances.
It’s not just your solicitor who can read it. You have various government organisations that can requisition your file and read it too, including (but not limited to) The Legal Ombudsman, The Solicitors Regulation Authority, The Police with a court order, HMRC for tax purposes, Office of the Public Guardian if you act with their authority, the Court of Protection, the Local Authority in relation to benefits payments (like social care costs) and if it is reasonable, they can share this data with others.
One authority may pass the information to the other. They (meaning the government) use it to fish for committed crimes or general misdemeanours. Money laundering regulations in their original form in the 1980s and 1990s were primarily to advance the war on the drug trade – but now they’re also for more basic things like tax avoidance.
If you’ve leased a building which does not comply with Energy Performance Regulations [which would be enforced by Trading Standards], or to see if you have given your assets away to with the intention of claiming care home costs from the local authority – for which there is no limitation period for recovery from the beneficiary, if the intention can be established. And, worse if you withhold a file, so you fail to disclose it when asked, that act of non disclosure give rises to the presumption of ‘deprivation’ making it easier to recover those assets from the people who’ve received them. But if the file has been destroyed then no such presumption arises…
How did it start?
Everyone knows that it’s called ‘money laundering’ because allegedly, Al Capone used to put his ill gotten coins through the slots on his laundry machines. On paper he did a lot of laundry, in reality the machines were empty. It’s certainly true that it is a story. It was a paper exercise which rendered him almost untouchable, except for his taxes.
However, the original idea of ID checking people to combat crime seems to have been put forth by the United Nations in the 1988 Vienna Convention under article 15. In the 1988 all UN members states agreed to pass laws which required their financial institutions to ID check their customers and clients. It was a staggering act of infringement on financial privacy, perhaps the greatest single act of mass surveillance ever. A masterstroke.
Everyone in the world who used a bank had to submit their ID – everyone in the world with any money at all, in other words. This UN resolution passed in EU Law and from there into member states’ sovereign law. So it arrived in the UK in the form of the money laundering regulations and has been updated every couple of years since them. Initially to aid in the ‘war on drugs’ it gradually expanded to include certain non crimes and non criminals.
Remember that only 12 years later the camera phone was invented – in around 2000 – which really made this easy to implement. And now in 2025 keeping your ID both recorded AND secure is the holy grail of digital privacy. At times it seems very hard to have both!
The 1980s was the era of the war on drugs – the international cartels attacking the moral fibre of society all over the world. Even James Bond got a look in during ‘Licence to Kill’. In the real world, the regulations came in from that perspective of protecting the public interest and, at least in the UK, the noose was tightened (or expanded?) to include all crimes with financial benefits and individuals who appeared on relevant government lists.
Politically exposed people (spies), people with ‘adverse media’ (outed spies) anyone on a sanctions list (spies not yet outed, certain extremists and other ‘groups’ of various political persuasions, for example). Not convicted criminals, but people who may be not acting in our national interest – businessmen and mercenaries, people who bring lots of money from other countries who we no longer approve of.
For example, after 911 the risk was commonly know to be a ‘Howala’ – for cash transfers which may not actually be illegal in themselves. For those that do not know, Howalas work by letting you deposit your cash somewhere – like a bakery or some cash based shop in your local town which may appear to be unrelated to money transfers.
In exchange the ‘baker’ would give you a piece of paper with 16 digit pin number on it. You then took your pin to a dissimilar shop in another town, in another country maybe, where you can withdraw your cash for a 10% fee. It’s completely untraceable and not necessarily illegal. But, if your solicitor sees lots of cash going in and out of your bank account, this would give him grounds for reasonable suspicion of money laundering.
The sources of the cash are unexplainable and cannot be traced once you’ve thrown away your post it note with your 16 digit pin. Similarly, your solicitor cannot act for someone who does this without facing the severest consequences, if caught. Jewellery, bitcoins, gold bars, small things with big value which are easy to physically transport are all fair game and open to exploitation.
Questions:-
What information does your solicitor hold on you and why?
In the table below is a non exhaustive list of the information your solicitor must hold on your file – whether or not they want to. This is your legal “Cookie”. Why? Two reasons. Firstly, as above. They must do it or else the men in black helicopters will spirit them away (not literally, this is merely the lazy use of a tired trope. It’s more likely to be a transit van with bright stickers.). Secondly, because you’re giving your solicitor your money to purchase a house, your solicitor is a trustee of your money – they hold it for your benefit.
This is known as an implied trust. This means if that money goes missing for any reason, your solicitor trustee must put it back in your bank account even if he is not at fault. An example – your solicitor buys a house on your behalf by transferring your money to another solicitor, who in turn gives the money to the seller. But the seller is an imposter. This means you don’t not get the title to your new house in exchange for your payment. There is no valid “TR1 form” to vest the title in you, the buyer.
Your solicitor has done nothing wrong. He can only transfer the funds to other solicitor who may or may not have checked the sellers’ ID carefully. But the innocent solicitor acting for you must restore the missing money to you because he is your trustee, or apply to a court (a very high court) for ‘relief’ from his obligation on the basis that he was not at fault. In the infamous “Dreamvar Case” this idea was tested, and proven correct – somewhat unfairly from the innocent buyers solicitors point of view, and their insurers too.
It created a precedent where a person who had done nothing wrong (the buyers solicitor and their insurer) must compensate the victim of a crime they did not perpetrate and could not prevent. In other cases, the court has granted relief. However a lot depends on the facts and perhaps the whims of the trial judge. This case shows why ID checking is so important to your solicitor, as failing to do it puts him in breach of trust. The fact that he can be in breach of trust EVEN if he does check everyone’s ID is merely unfortunate.
This is a list of the information your solicitor must keep about you if, for example, you’re buying or selling a house.
Passport – photo evidence,
Drivers licence – photo and address evidence,
Linking evidence – documents sent to one of your addresses concerning another of your addresses.
National Insurance number – which links to your tax returns at HMRC linking you too SDLT, CGT, IHT, INCOME TAX, PAYE, CORPORATION TAX, BENEFITS, CHILD CARE
Electronic ID check – 6 + credit agencies, council tax checks, government sanctions list, post office redirects, bankruptcy checks, credit record checks, Politically exposed people (spies!) check, Sanction list check, Adverse media check,
Source of income and earnings – no criminal activity or tax evasion – bank statements and paye slips – looking for unexplained (cash) payments,
Assets checks, whether you own too much or too little relative to the case in hand, unexplained wealth (etc etc!) Plus advice and communications all documented
When does your information get destroyed?
Typically six to seven years after your case closes. The solicitors keep your file so that they can prove that they’ve discharged their duty to you and they can defend any claim you make about negligence or breach of contract or retainer i.e. not doing a proper job which costs you money. This is your legal data cookie, and it can be reasonably destroyed six to seven years after your case closes.
You lose any evidence of your solicitors mistakes, if they made any, but the government also can’t go on a fishing exercise for your data and finances. The cookie has gone but so has the evidence you may need to protect yourself later on. Quid pro quo in other words. The general limitation period is six years from acting for you, in layman’s terms. Although the six years can be extended in some circumstances.
What exactly is a solicitor now?
A solicitor is there to help you, a lot like they used to be. But this help is qualified. It is offered on the condition that (1) it is in the public interest and (2) it is actually legitimate in purpose to help you. So the burden is on you to prove your innocence at the outset of the case. But as well as the acting and advising which you’re familiar with, the solicitor will also do some surveillance and data gathering on you, the client, the other solicitor and the other parties in the case too.
The burden or duty to investigate only goes up every year. They build up a profile of you to assess the risk of whether you’re doing money laundering – e.g. unexplained wealth or links to undesirable organisations, like a howala (an extreme example for the purposes of this article). The objective test for suspicion falls on the solicitor who must show there are no reasonable grounds which would mean they have to resign or report the case to government.
They’re not even looking to see if you’ve actually got a criminal conviction, they’re looking to see if you ought to have one… which raises a question of the average solicitor’s knowledge of the criminal law. They may know little to nothing about it actually. One of the dangers of the profession over specialising in their advice and training. How many conveyancers know what is the crime of conversion, without looking it up?
Conclusions.
I started to write this before the formal announcement of the proposed new digital ID cards, which will be introduced so ‘they know exactly who is working in the economy’ quoted verbatim from the PM. Digital ID is simply another form of mass surveillance. And yet the idea that tracking peoples ID in order to prevent crime seems to have failed.
If the program of ID checking introduced by the Vienna Convention in 1988 had been successful, we would not have an extant issue with crime and money laundering in the 2025. Also, if the hypothesis that ‘surveillance will prevent the drugs trade and money laundering’ was true, then the justification for mass surveillance would disappear with it along with those crimes which it intended to eliminate.
It must be concluded, perhaps cynically, that the benefits of surveillance are far greater than merely helping catch professional criminals. Further, since the link between deterrence and ID checking is none existent then the requirement can never be vitiated. Neither financial crime or ID checks are going away any time soon because they do not depend on each other.
Undoubtably there have been successes – this information is used to track, trace and convict criminals doing bad deeds. That is a good thing, but this is only after the event. The wider benefits to the state from these forms of surveillance go far beyond the prevention of very specific crimes.
It does not prevent or disincentivise the wrong doing in the first place. Further, the regime also now includes things which were not bargained for at the outset, taxes, care home costs, sanctions list, adverse media even. A slow salami slicing of your veil of privacy. It’s also the one of the reasons your legal work takes so long now, as the consequences of non compliance are so dire that no reasonable lawyer wants to be implicated and investigated.
What can you do?
Mainly, you can avoid the obvious pitfalls which will give rise to false results – keep your cash deposits to a minimum and have a reasonable explanation for them. Will the US administration use bitcoins to redeem their national debt as is rumoured? There’s nothing wrong with bitcoins but make sure they’re documented properly and you use a secure and recognisable exchange.
Keep track of your own legal documents and do your own research. Destroy things you don’t need, but keep things that you do need. For daily boring computer stuff, use password holders and VPNs to stop your data getting into the wrong hands. Log out of your accounts, don’t just close the page or app when finished (note to self -this is a big one).
For most people, they may view this article as an irrelevance. A boring tick box exercise as they have nothing to hide to in the first place. And one piece of data on its own has little value of course because it is so abstract. Perhaps in reality the short term detriment to you and your legal case is very little, an extra delay or a some extra cost whilst you move house or sign up to new lease.
In my experience, most people are fundamentally good even if they make mistakes from time to time, an error that can be forgiven or undone or reasonably explained. The real issue is that the data goes up the chain into the hands of fewer and fewer people who increasingly exercise more control because of their possession of it. The question is of course, what will it be used for?
Related article – what is a lease, and how long should it be?
Buying a Converted Property: Mortgage Risks, PCCs and Essential Legal Checks
Selling a House Without an EPC: Is It Money Laundering or Proceeds of Crime Under POCA?
Commonhold Conversion in 2026: Voluntary or Compulsory?
- Sale and Rent Back UK: Is It Legal Under FSMA 2000?
- Selling a House Without an EPC: Is It Money Laundering or Proceeds of Crime Under POCA?
- Luxury Watches Crypto Money Laundering: AML Risks & UK 2026 Regulations for Conveyancers
- 8 Essential Things You Need to Know About UK Financial Sanctions – UK Sanctions Explained
- How to Safely Pay Your Solicitor: A 3-Step Guide to Avoid Scams
Frequently Asked Questions
Q: Why do solicitors require ID and financial information?
A: UK Money Laundering Regulations require solicitors to verify your identity and source of funds. This serves two main purposes: preventing criminals from laundering money through property or financial transactions, and protecting against fraud (e.g. ensuring money is paid to the genuine client, not an imposter).
Q: What documents are typically needed?
A: Common requirements include a passport or driving licence (for photo ID), proof of address, National Insurance number, bank statements, payslips, and sometimes electronic ID verification. Solicitors also perform checks against sanctions lists, politically exposed persons (PEPs), and adverse media.
Q: How long do solicitors keep my information?
A: Typically 6–7 years after your case closes. This allows them to defend against any future claims and comply with regulatory requirements.
Q: What happens if my solicitor has suspicions?
A: If there are reasonable grounds to suspect money laundering, the solicitor must report it to the authorities. Failure to do so can result in prosecution for the solicitor. They cannot usually inform you of the report (known as “tipping off”).
Q: Are these checks only for conveyancing?
A: No. They apply to most legal services involving money, property, or assets, such as wills, probate, and company work, though requirements vary by transaction risk.
Q: Can I refuse to provide the information?
A: You can, but your solicitor may then be unable to act for you, as they must comply with the law.