Law firms operate in a highly regulated and supervised environment. As a result, setting out the way in which it operates in a series of policies, procedures, and documents is essential for all firms.
However, just having a standard set of policies and procedures in place is not enough. Firms must ensure that these are correctly monitored and enforced and that they truly reflect how the firm works and are up to date with regulatory requirements.
The SRA has been stringent in their sanctions against law firms who breach their obligations, with a particular focus on AML failures. Recent disciplinary actions have highlighted concerns that firms are not putting in place strong enough processes, with one sanctioned firm accepting that the misconduct was “unintentional and unwitting” and occurred “as a result of the firm’s failure to properly monitor its own policies and procedures”
– read our previous article, “Personal penalties for AML Rule Breach.”
What do I need to do?
Failure to have a suite of documents that reflects how a firm works and directs its staff on their responsibilities is a failure on the part of a firm and exposes the firm to criticism by the SRA and potentially the firm’s Professional Indemnity Insurers. To combat these issues, a firm should be adopting some of these following suggestions:
i) Bespoke documents and procedures –Documented processes can quickly become out of date, especially when using template documents that do not reflect the reality of the firm’s internal workings. Adopting standard template documents can inadvertently change how the firm operates in practice and result in a mismatch between the written documents and the reality. A firm can protect itself by ensuring documentation is bespoke to them and reflects what they do in practice.
ii) Monitor and control –The best and only way to manage and control how the firm operates is to record and document the processes and procedures adopted by the firm and make sure that they are monitored and maintained in practice day-to-day.
iii) Training – Firms should provide training on new or updated procedures to all appropriate staff.
2.1 Expert Process and Procedures Drafting
The Strategic Partner provides quality and bespoke document drafting in consultation with the firm and can incorporate a range, from single documents perhaps relating to Client Care to a more complex series of documents, such as Risk and Compliance and Anti-Money Laundering.
The Strategic Partner will work with firms to generate bespoke documents that reflect how they operate. We will help establish best practices and implementation of any changes so that the policies match reality.
Our document drafting service includes
- Risk and Compliance documentation
- Client Care Documents
- Office Manual
- Accounts and Finance Manual
- Employee Handbook
- Performance Management Processes
- Business Continuity Plans
- Data Protection and GDPR
- Lexcel / SQM applications, pre-audits and renewals
- CQS/WIQS application and renewals
2.2 Risk, Regulation and Compliance Service including AML
For a more comprehensive solution, our Risk, Regulation and Compliance Service (including AML) has been designed to provide law firms of all sizes with a compliant environment. Included in the standard service, we provide policies and procedures bespoke to how your firm works whilst drawing your attention to any gaps in your risk and compliance activities. – Risk, Regulation and Compliance Service, including AML
About The Strategic Partner
The Strategic Partner is a law firm knowledge hub. We work with law firms and professional indemnity insurers, advising and guiding on risk management techniques to assist and reduce instances of claims or regulatory breaches.
We offer a range of services and consultancy tailored to the Legal sector. We have gained a wealth of knowledge and experience in the overall management of law firms and work with them to achieve profitability, stability, and efficiency. Our goal is to become a valued and respected partner to our member law firms, consistently providing high-quality services and solutions.