The UK Government has a track record of burying its head in the sand when it becomes clear that its legislation is half-baked. Take, for example, the new contracts introduced in 2004 allowing GPs to opt out of providing 24-hour care to patients. The changes meant that many NHS trusts were forced to introduce a system which gave greater responsibility to nurses to diagnose medical conditions. The Department of Health, however, seems unconcerned that most nurses do not have the training to differentiate between a headache and meningitis and have claimed that most patients have benefited from the new system.

Against that background, it does not come as a surprise that the latest consultation paper on the consent regime under the Proceeds of Crime Act 2002 (POCA) barely scratches the surface of the problems that POCA has created. Consider a scenario in which one of your colleagues learns from an article highlighted in your firm's know-how bulletin that one of your largest clients is at the centre of an investigation by the European Union authorities into alleged cartel activity. Much to your surprise, rather than using it as an opportunity to pitch for work from that client, your colleague considers it necessary to report the allegations in the article to the firm's nominated officer who considers it necessary to then report to the Serious Organised Crime Agency (SOCA) as he is concerned that, if he fails to do so, he may be criminally liable under the Proceeds of Crime Act 2002.

Clearly your colleague is out of his mind. Or, is he? Before you conclude that your colleague ought to be escorted off the premises in a straight-jacket, it is worth pointing out that there is no exemption to the requirement to report under POCA for information that is already in the public domain. Under section 330, a person is required to make a report under POCA where he knows or suspects, or has reasonable grounds for knowing or suspecting, that a person is engaged in money laundering. 'Money laundering' has a very wide definition under POCA; it does not just extend to the use of the proceeds of serious crimes but also captures the use of the costs saved by a company from a failure to make certain filings at Companies House. There is a defence for failure to report where you have a 'reasonable excuse' for doing so, but this defence remains untested in the courts. So the only safe option for your colleague is to make a report.

Similarly, as part of its matter or client-opening checks, your firm probably conducts searches of the internet and/or the databases of intelligence providers in order to comply with the customer due diligence requirements of the Money Laundering Regulations 2007. But if you discover that the prospective client may have been involved in 'money laundering' and you conclude that there is a possibility, which is more than fanciful, that the relevant facts outlined in the results are true, you must make a report to your nominated officer who, in turn, must report to SOCA, regardless of whether you have any further evidence to substantiate the suspicion.

It is not clear what is gained from this. Lawyers (and other reporters) waste time and money preparing the necessary SOCA reports, while SOCA employees are given the soul-destroying task of reading such reports only to realise that they read the same thing in the newspapers last week. Upon calling the person who submitted the report, they discover that the reporter has no further information but is merely reporting the existence of the news article in order to absolve himself of any criminal liability. So the whole exercise is pointless.

This is just one of many absurdities that are not addressed in the latest consultation paper. It is about time that the Government addressed the issues in a considered and sensible manner, rather than rushing through yet more half-baked proposals.

Mark Humphries is a partner and head of advocacy and Suzie Ogilvie is a risk lawyer at Linklaters.