Spotting Red Flags Before You Open the File

Amy Bell
3 days ago
2 min read

Author, Amy Bell, CEO and Founder of AML Sorted

One of the most valuable things we cover in my AMLCO masterclasses is the importance of noticing red flags before you even open the file. This stage is often overlooked, but it is critical because it shapes everything that follows, including the level of due diligence you will need to apply.

During the session I shared some examples that always get people thinking. When someone is vague, reluctant or oddly disinterested in a transaction, it is more than poor communication. It can be a signal.

“Who do you know who is buying a house and is not excited about it? A crook who just wants to put a cannabis farm in it.”

People laugh when I say that, but it perfectly captures the point. Genuine clients have a reasonable level of interest, curiosity or enthusiasm in their matter. When that is missing, take notice.

A few early red flags to watch for

Unusual secrecy or hesitation to provide information
A complicated ownership structure with no logical purpose
Someone hovering behind the scenes who appears to be pulling the strings
A background that does not match the scale or nature of the transaction
An instruction that sits outside your usual expertise

These are not automatic deal-breakers, but they are prompts. They tell you to slow down, ask a few more questions and think about your risk rating before you move further.

Why it matters under the new AML/CTF regime

Tranche 2 brings lawyers, conveyancers and real estate professionals into a formal AML/CTF system. Early-stage red flag detection will be one of the easiest ways for firms to stay compliant without slowing down client service.

Once your team builds the habit, it becomes a natural part of file opening, not an extra step.

If you remember one thing

Use early interactions as intelligence.

They shape your risk assessment and help you identify when the matter might need extra scrutiny. And write it down. A regulator cannot see a conversation in your head.

If you’d like a structured way to capture that information, Sorted Solutions gives you pre-built prompts for exactly these scenarios. But start with the habit. The system can come next.

Thanks for reading.