Reasonable Excuse - Client with previous convictions

Presented facts (names changed to preserve confidentiality).

When Jim Montgomery accepted Peter Benson as a client, several years ago, he knew that 5 years previously he had served a prison term for violent assault. However Peter had been a model citizen since coming out of prison and, Jim reasoned, one should not hold a man's past mistakes against him. In the event, Peter had never given Jim any cause for concern.

Until, one day, Jim's assistant Sally came to his office pale and shaking.

Sally told Jim that she had been doing routine accounts preparation work at Mr Benson's premises when she stumbled across documents which made it clear that he was deeply involved, with others, in serious crime. These activities were totally outside 'the books' which she was working on. Looking up, she had asked Mr Benson what the documents were. He took them off Sally and told her that they were none of her business and that if she told anyone about them it would be the worse for her.

His tone and manner had left Sally in no doubt that she had been threatened with violence and she had immediately returned to the office in something of a state.

Jim realised at once that he had a duty to report the information to SOCA, but he also needed to protect and reassure Sally.

Jim asks whether he can report the matter to SOCA anonymously.

MLRO Support Ltd - Our Opinion:

We advised Jim that reporting to SOCA anonymously is not a viable option.

Reports to SOCA are themselves confidential and so is the source of the information in them. However SOCA do, of course, pass information from reports which they receive to the police and other law enforcement agencies.

There would be a risk that if action were taken by the police against Mr Benson that he might assume that Sally had passed information to the police and might carry out his threat. An anonymous report, even if that were otherwise acceptable, may not therefore protect Sally.

Jim had two realistic options.

First, he could report the matter to SOCA making clear in the report the threat of reprisals and the danger to his staff (and himself). When submitting the report by fax, Jim could also phone the SOCA Duty Desk underlining his concerns.

The second option was not to report the matter to SOCA at all. The law permits reports not to be made where there is a reasonable excuse. The threat of violence to Sally would, in our view, be a reasonable excuse not to report.

Jim decided not to report the matter.

He also decided that his firm would cease to act for Mr Benson at the earliest opportunity due to a 'conflict of interest with another client' or some other reason. At the same time Jim decided that, in the event he received a professional clearance letter from a new accountant instructed by Mr Benson, he would give the usual information and make no mention of the problem.

Jim was far from happy with this course of action, but considered that his paramount duty was to protect his employee.