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Personal penalties for AML Rule breaches – Be aware and take action to comply.
March 17, 2022

A recent notice published by the Solicitors Regulation Authority stated that a former manager and partner of a large London law firm has been personally sanctioned for his part in anti-money laundering failings. In total, he was fined £17,500 plus £3,500 in costs which he has agreed to pay. The sanction relates to the same matter in which the high profile London firm agreed to pay a £232,500 fine following an agreement with the SRA in January –  one of the biggest fines ever imposed by the regulator – over several breaches relating to money laundering rules.

Personal breaches of the rules included his failure to correctly undertake a full set of customer due diligence despite the work presenting a higher risk of money laundering or terrorist financing, under the relevant money-laundering rules. Furthermore, it was discovered he had not undertaken mandatory training as required by AML regulations. He told the SRA he regretted his lack of understanding at the time and accepted responsibility for gaps in his knowledge.

The firm involved said it cooperated with the SRA investigation and acknowledged its due diligence and training failings. New IT systems have been introduced with centralised record-keeping to prevent future similar breaches.

The former manager and partner involved said he assisted the SRA investigation, admitted rule breaches, and has since undertaken comprehensive AML and accounts rules training.

The regulator has made it abundantly clear that it expects firms, and those holding client responsibility, to be alert to their obligations in respect of preventing money laundering.

Increasing numbers of firms are being asked to demonstrate their understanding of the requirements of the regulations and, importantly, evidence their compliance through the provision of documents and submit to files audits and staff interviews. At The Strategic Partner, we have worked with and assisted many firms in this enquiry process and continue to do so.

For many firms, dealing with this in-house without sufficient understanding, resource or time can be highly challenging to supervisors, compliance officers and their business, as compliance with the AML regulations is not as simple as it may first seem, often expert advice and guidance is essential to ensure your firm achieves a compliant status and maintains it.

Fast Track, Cost Effective and Robust Compliance Solutions inc AML Compliance

The Strategic Partner’s packaged compliance solutions for law firms enables our clients to achieve a compliant status, and we continue to work with them on an ongoing basis to ensure they stay compliant. This includes compliance with the AML Regulations 2017.

This allows the owners and staff to focus on services for their clients and running the firm knowing that their AML requirements are taken care of.

Our focus is to ensure each firm that works with us operates in a fully compliant environment and stays there. Through achieving this, the compliance officers in the business can be assured and confident that their obligations are being met, enabling them to focus on other areas of the firm.

Our Risk, Regulation and Compliance Service, including AML provide firms with a robust approach to Regulations, Compliance and risk management, giving the compliance officers peace of mind that the requirements of the regulator are being met on an ongoing basis and can be evidenced. External expert support will enhance the core strategies for firms with an internal team or person allocated to managing regulation and compliance.

If you believe your firm may be at risk or wish to confirm your firm is achieving the required standard, at The Strategic Partner, we offer a range of solutions.

Our Services

3.1. Regulation 21 AML 2017 Independent Audit – A review of the firm’s approach to regulation and compliance to include AML procedures with the audit meeting the requirements of Regulation 21 of the AML 2017. The output of which provides the firm with a written gap analysis and solutions to remedy any issues that rise and ensure the firm is compliant, see our brochure.

Training – Our typical AML Training includes:

  • AML Training for ALL staff to meet the firm’s obligation to provide annual training.
  • 1-2-1 training for the MLRO and MLCO on their obligations and requirements.
  • Practical training for those involved in client onboarding to ensure their ID and AML checks are correctly completed.

File Revies/Auditing – At TSP we engage with firms undertaking files reviews where we consider procedure, staff, systems and files to ensure the procedures are up to the required standard and being implemented at case level with a report of the outcome.

Our Packaged Compliance Solutions – Implementation of robust solutions to ensure the firm achieves compliance and then maintains compliance through the provision of ongoing support and assistance: –

Risk Regulation & compliance Service including AML  – Our Risk, Regulation and Compliance Service (including AML) has been designed to provide law firms of all sizes with a compliant environment. We provide you with policies and procedures that are bespoke to how your firm works, whilst drawing your attention to any gaps in your risk and compliance activities.

We work with firms of all sizes and types, from partnerships to ABSs, high street firms, and multinational firms. Each firm is different, and whilst there is a commonality of regulation and expected standards, it is essential to recognise how a firm implements compliance to tailor the solution to each firm’s working practices.

Risk, Compliance, AML Guidance and Register Administration Service – Running a compliant law firm is not just about implementing a set of policies and procedures; the obligations of the Compliance Officers stretch way beyond this, as there is an ongoing responsibility to manage, maintain and monitor the application of the firm’s compliance strategy.

The Strategic Partner’s Risk, Compliance, AML Guidance and Register Administration Service is an outsource solution providing all staff with access to an experienced and knowledgeable Compliance Manager for guidance, and ensuring the regulatory requirement active management of the firm’s registers is met.

Our regulation and compliance services

We would be pleased to discuss your current approach to regulation and compliance and how our services will assist you in ensuring your firm is protected.

Often expert advice and guidance is essential to ensure your firm achieves a compliant status and maintains it.

Enquiries

For more information about our Regulation and Compliance Services (including Anti Money Laundering), you can call us on 0203 911 9710 or please email us at info@thestrategicpartner.co.uk.

 

You can view and download the PDF version of this article here. 

 

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