Professional Ethics and Anti-Money Laundering Obligations
What the exam tests
Professional ethics and anti-money laundering obligations. Sources include the Notaries Ordinance, the Financial Transactions Reporting Act No. 6 of 2006, Financial Intelligence Unit rules and FATF-style customer due diligence standards.
Core rules
- A notary must act with integrity, competence and independence; avoid conflicts; charge only lawful fees; and not tout for business.
- Confidentiality is a duty, but it is not absolute: statutory reporting, court orders and client consent may permit disclosure.
- Notaries are gatekeepers against money laundering. Apply customer due diligence: identify the client and beneficial owner, verify identity, ascertain source of funds and purpose of the transaction, and screen politically exposed persons.
- Keep records for the required period, generally at least five years, monitor transactions and file suspicious transaction reports with the Financial Intelligence Unit without tipping off the client.
- Use a risk-based approach: enhanced due diligence for high-risk clients, complex structures and cash-heavy property deals.
Worked example
A client asks a notary to attest a property transfer where the purchase price is paid in cash by an unknown third party and the buyer is an offshore company. The notary must identify the beneficial owner, ask for source-of-funds evidence, and assess the risk. If the explanation is inconsistent, he should decline and file a suspicious transaction report; he must not warn the client.
Traps
Relying on an introducer's assurance; tipping off; treating confidentiality as absolute; and keeping no customer due diligence records.