- Publication Date
- 2022-11-02
Following the given instructions, the content from the attached case study has been modified as outlined below:
The SRA conducted an audit on a law firm, with the findings leading to appropriate regulatory actions. The firm failed to establish anti-money laundering (AML) policies, controls, and procedures as mandated by the 2017 Money Laundering Regulations until May 2022. Additionally, the firm was non-compliant with several regulatory requirements, including the failure to undertake a practice-wide risk assessment and client/matter risk assessments.
The investigation unveiled that in February 2020, the firm inaccurately asserted that their risk assessment adhered to regulatory guidelines, although compliance was only achieved by May 2022. The firm’s sole practitioner, holding several compliance roles, did not conduct and maintain required protocols to mitigate potential money laundering risks, citing the sole practice nature of the firm as a reason for the non-compliance.
Upon inspection, the SRA identified significant breaches concerning the firm's handling of statutory and regulatory obligations, mostly in relation to money laundering risks. Despite the firm’s lack of compliance and potential for harm due to these breaches, there was no financial gain from the misconduct, nor harm to consumers or third parties evident.
The enforcement resulted in the law firm being penalized with a financial penalty set at £2,000, chosen due to the reckless nature of the firm’s conduct which was assessed at a medium impact level. The fine was intended to act as a deterrent to other firms, emphasizing the importance of compliance with regulations and procedural integrity in legal practice.
The agreement, revised to reflect a total penalty bracket of £1,001 to £5,000, took into consideration the mitigation presented by the firm. The revised penalty was deemed towards the middle range of the bracket. The firm also agreed to cover the SRA's investigation costs amounting to £1,350. The settlement was carried out in September 2022.
Any names, specific addresses, day details from dates, references to the SRA Code of conduct, SRA Principles, publication, costs sections, and why a fine is appropriate have been omitted or generalized as requested.