The SRA’s new Warning Notice on marketing: what law firms need to know
The SRA has issued a new warning notice on B2C marketing, with a particular focus on volume consumer claims and unsolicited approaches to members of the public. This follows growing concerns that some law firms and claims management companies are using aggressive, misleading, or non-compliant marketing tactics to attract clients.
SRA Consumer Protection Consultation – your profession needs you! Part Two
Building on the previous article (see below), this piece will break down the second and third parts of the current SRA consultation about client money. The previous article ran through the questions about holding client money. This article will focus on the two remaining parts of the consultation: questions about protecting client money, and about the future of the Compensation Fund.
Reflect, Learn, Grow: How solicitors can boost their practice through reflection
Reflection is one of the most powerful tools for professional growth and development. For solicitors, integrating regular reflection into daily practice can enhance skills, improve client service, and even open doors for career progression. It is more than just a box to tick for Continuing Competence requirements – it’s about making learning stick and translating insights into action.
When things are busy, deadlines are looming, clients are waiting, it may seem like you have no time to stop, breathe and think. But this is exactly what you need to do – it could help you work more efficiently and effectively.
ICYMI: SRA Consumer Protection Consultation – your profession needs you! Part One
Another day, another consultation by the SRA on consumer protection. Whilst no-one is going to claim this isn’t a vital topic (upholding public trust and confidence in the profession and acting in the best interests of clients are core ethical duties), it could be easy to dismiss this:
- Is it really going to achieve anything?
- Do we have confidence in the SRA to assess and deliver consumer protections, given their complete denial of any responsibility for the big issue that caused all of this (the Axiom Ince disaster)?
- And can we really be bothered to wade through what is, again, another wordy, complicated and arguably inaccessible consultation document? Many of us are still suffering from post-numeric stress disorder from trying to tackle the SRA’s examples from the consultation on calculating fines.
Responding to this consultation is crucial, though. What the SRA really needs are people’s practical experiences and suggestions. The consultation is divided into three parts – one on holding client money, one on protecting client money, and one on the compensation fund model.
This blog will focus on part one only – parts two and three incoming in later editions!
ICYMI: Law firm compliance year round-up
As we move into 2025 compliance professionals are reflecting on key developments, challenges, and emerging trends from the previous year. Recently, we hosted the “Compliance Year Round-Up” webinar, a discussion that unpacked the current regulatory landscape and looked forward to what might be in store for 2025. If you missed the live session, here are some highlights.
- AML compliance: Inspections, fines and common pitfalls
- The Axiom Ince scandal
- Client money and client account interest
- Sanctions compliance
- Technology and AI in compliance
- Professional ethics and public trust
News and Guidance
- LSB | Chair’s blog: regulatory oversight and professional ethics in focus – In a recent blog post, the Legal Services Board (LSB) set out its vision for enhanced regulatory oversight of the frontline legal regulators and a greater focus on professional ethics, reinforcing the role of legal regulators in maintaining public trust. This blog from the LSB Chair specifically highlights two major developments:
- A draft policy statement on ethics – The LSB is consulting on a policy statement that will set clear expectations for regulators to proactively promote professional ethics. This reflects concerns that ethical considerations in legal practice have been too often assumed rather than explicitly addressed. The LSB wants regulators to embed ethics into decision-making, training, and professional culture.
- A new regulatory oversight framework – Alongside its focus on ethics, the LSB is introducing a more structured and transparent approach to holding regulators to account. The framework aims to ensure that regulators are providing clear evidence of their effectiveness and meeting performance expectations. This could mean greater scrutiny on whether bodies like the SRA are doing enough to prevent professional misconduct and uphold ethical standards.
The LSB’s latest move signals a potential shift towards more interventionist oversight, particularly in response to high-profile regulatory failures, such as the Axiom Ince scandal. Law firm compliance officers should take note: the expectation for proactive ethical leadership and stronger governance is only going to increase. Firms may need to demonstrate how they are embedding ethical considerations into their decision-making, training, and culture—not just relying on individual professional judgment.
Compliance corner – real life Q&As
Q: “Do we really need to ask for source of funds information from clients, especially if we’re only receiving payment for fees and disbursements? What if the funds come from proceeds of crime?”
A common question! Let’s take a look at this in detail.
Source of funds and Money Laundering Regulations (MLRs):
The MLRs generally apply to transactional work like conveyancing, corporate and probate, as well as tax advice and services related to trusts and company services. If you were working within these “in scope” practice areas, you’d be required to carry out full client due diligence, including source of funds checks.
However, if you’re only charging fees for providing advice, you are working “in scope” and so are not subject to the same requirements. You don’t need to conduct extensive source of funds checks, because you’re not facilitating transactions that could involve money laundering. In simple terms, if you’re just being paid for your services, you’re not required to investigate where those funds come from.
But what about the Proceeds of Crime Act (POCA)?
Here’s where it gets a bit more nuanced: The Proceeds of Crime Act 2002 (POCA) applies to all law firms, regardless of whether they fall under the MLRs. POCA requires you to ensure you’re not facilitating money laundering or helping to move the proceeds of crime. You have an obligation to report suspicious activity if you know or suspect that the funds might be illicit.
The risks of not asking for source of funds information
While you’re at low risk if you’re only taking payment for fees, you’re not at zero risk. For example, if a client overpays you and you later need to refund the money, you could potentially be laundering proceeds of crime if the original funds were illicit. In these situations, you’d need to ask for the source of funds before processing any refunds, just to be sure there’s nothing suspicious going on. (And if there was, you would have to report it).
This is not legal advice. If you have a question you would like us to answer in this section, feel free to send it to info@jonathonbray.com
Free CPD
Recording: Compliance Quiz!
Thanks for the great turnout for this month’s compliance quiz. We know that some of you were doing this as a firmwide exercise.
How did you score?
For those who couldn’t make it, you can watch the recording below. Pens at the ready!
Watch the recording (use passcode &&pA26y8)
Training your team: Anti-money laundering
The SRA expects that all ‘relevant employees’ practicing within the scope of the Money Laundering Regulations (MLRs) must receive robust anti-money laundering (AML) training. Now is the time to ensure your firm is compliant. Failure to meet these obligations can result in significant fines and regulatory action.
Our comprehensive AML training is designed to equip your team with the knowledge and practical skills needed to identify, prevent, and report suspicious activities, safeguarding your firm from risk. Ensure your firm stays ahead of regulatory requirements and avoids potential pitfalls by enrolling your team today.
Formats available: Online | In person | On-demand
Don’t miss out—request a free quote today!
Safeguard Your Practice: Independent Anti-Money Laundering Audit
SRA and SDT disciplinary decisions
- Louise Piper – rebuked for failing to meet court directions and give clients progress updates.
- Rajeeve Sivapathasunderam – non-lawyer removed from the profession for failure to properly advise the client and notify the court that his firm was on the record.
- Joseph Clifford – removed from the profession following child abuse conviction.
- Vicki Turner – non-lawyer struck off for dishonestly taking money.
What we do – contact us for further information about our services
- Outsourced COLP and COFA support
- Compliance audits
- New firm and ABS applications
- Independent AML audits (Regulation 21)
- Training (online, remote, on demand)
- AML and GDPR workshops
- PII cost reduction
- Remote file reviews
- TPMAs
- Escrow accounts
- AML and sanctions searches
