London lawyer faces money laundering, PEP charges linked to super-rich sisters
23 May 2018

A partner at a City law firm has landed in trouble for allegedly failing to comply with anti-money laundering rules in a case linked to the Panama Papers and a wealthy politically-connected family.

Child & Child’s Khalid Mohammed Sharif is understood to be linked to the setting up of an offshore company for Leyla and Arzu Aliyeva – the daughters of Azerbaijan President Ilham Aliyev – using Mossack Fonseca, the law firm central to the Panama Papers.

The sisters are reported to have a vast business empire covering luxury apartments, telecoms and gold mining.

Sharif failed to take any steps to ascertain whether his clients – referred to as the ‘A Sisters’ – were politically exposed (PEPs) or whether they were reportedly linked with the proceeds of crime, the Solicitors Regulation Authority (SRA) said.

He also failed to apply enhanced customer due diligence in respect of the A Sisters, in a situation which presented a higher risk of money laundering, or “where the customer had not been physically present for identification purposes,” the SRA explained.

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In addition, he acted in circumstances that “disclosed a significant risk that money laundering was taking place,” the regulator said.

The matter is reportedly the first Panama Papers case brought forward by the SRA, two years after the expose hit the headlines.

Commenting generally, the SRA said: “We have been working with other agencies to tackle concerns raised by the papers. Although in many instances, we found that the law firms and lawyers mentioned are not based in this country or regulated by us, we still have a number of ongoing investigations.”

“The credibility of law firms makes them an obvious target for criminals wishing to launder money.”

If found guilty, Sharif could be struck off.

Sharif and Child & Child did not respond to requests for a comment when contacted by KYC360. The Azerbaijan President’s Office and the Azerbaijan embassy in London also did not respond.

In March, Mossack Fonseca reportedly announced it was shutting down, saying in a statement: “The reputational deterioration, the media campaign, the financial circus and the unusual actions by certain Panamanian authorities, have occasioned an irreversible damage that necessitates the obligatory ceasing of public operations at the end of the current month.”

Read more:

HSBC freezes $500m: Funds came from a Standard Chartered account in Angola

Confessions of a compliance officer: How I handled dodgy demands

Alleged mastermind behind EUR 1 billion cyber and laundering scam arrested

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