- Publication Date
- 2024-05-24
In March 2022, an investigation was initiated into the law firm by the SRA. The investigation found that the law firm had undertaken three conveyancing transactions on behalf of the partners of the firm or their family members between 2011 and 2019, meaning these transactions fell under the scope of the Money Laundering Regulations of 2017 and 2007. The law firm did not have in place any of the required documentation or training for its staff, had not appointed a Money Laundering Reporting Officer, and had not sought approval for all beneficial owners, managers, and officers of the firm as mandated by the regulations.
The investigation identified three ledgers in the name of a partner and his family member where the firm allowed multiple payments to be processed through the client account without an underlying legal transaction or a service forming part of the typical regulated activities of solicitors. This conduct persisted over a prolonged period.
Between April 2008 and November 2019, the law firm engaged in conveyancing and transactional work falling within the scope of the MLRs 2007 and the MLRs 2017. From April 2008 to June 2017, the firm failed to establish and maintain appropriate risk-sensitive anti-money laundering policies and procedures and did not ensure that all relevant employees were informed about the law related to money laundering and terrorist financing. Additionally, it fell short in providing regular training to employees on recognizing and managing transactions that might be related to money laundering or terrorist financing.
From June 2017 onwards, the firm did not maintain a documented and compliant AML firm-wide risk assessment, nor did it establish and maintain adequate policies, controls, and procedures to mitigate and manage the risks of money laundering and terrorist financing. The firm also failed to take appropriate measures to ensure that its relevant employees were informed about the laws and regularly trained in dealing with suspicious transactions. Furthermore, it failed to seek SRA approval for all beneficial owners, managers, and officers as required.
From February 2018, the firm did not appoint a Money Laundering Reporting Officer.
The disciplinary decision noted that the firm permitted and failed to prevent its client account from being used to provide a banking facility, involving activities not related to any underlying legal transaction or service forming part of the normal regulated activities of solicitors. This conduct continued for a lengthy period.
As a result, it was determined that the firm committed breaches by failing to meet obligations under the applicable Money Laundering Regulations and Solicitors Code of Conduct.
The law firm was directed to pay a financial penalty and cover the costs related to the SRA's investigation.
The firm's cooperation with the SRA and remediation of the breaches were considered mitigating factors leading to the assessed fine.