- Publication Date
- 2021-06-23
The SRA conducted an audit on a law firm. The firm needed to be compliant with the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLRs 2017), which came into force in June 2017. These regulations required firms conducting certain types of work to carry out a risk assessment to identify and assess the business’s risks of money laundering and terrorist financing.
The SRA requested that all those firms complete a declaration by January 2020, confirming they had a compliant anti-money laundering firm-wide risk assessment. However, the law firm did not provide its declaration until March 2021, breaching several SRA regulations.
The SRA's investigation found that the law firm had failed to appropriately establish and maintain policies and procedures relating to the firm's compliance with the MLRs 2017. It was noted that the law firm's failure extended to inadequate due diligence, deficient risk assessments for clients, and insufficient supervision and training of its staff regarding anti-money laundering measures.
Consequently, the SRA directed the law firm to pay a financial penalty. This decision underscored the importance of adherence to anti-money laundering regulations to prevent financial crimes within the legal sector.
The SRA, by taking these regulatory actions, reinforced its commitment to upholding professional standards and legal compliance among law firms. The outcome of the audit was published to inform other firms of the serious repercussions of non-compliance and to encourage better practices within the industry.