Register of overseas entities – is it too risky to be a verification agent?
The new Register of Overseas Entities presents solicitors with the opportunity to develop a practice as verification agents for new and existing clients. On paper, the work itself may not (necessarily) be difficult, particularly for those steeped in the Money Laundering Regulations compliance. Although there will be cases where verifying the beneficial ownership of overseas entities will be a formidable task. Complex structures in opaque jurisdictions will pose particular challenges.
Anecdotal evidence suggests that many law firms are reluctant to take on the work, put off by the perceived risk and short deadlines. These risks are highlighted in The Law Society’s guidance for solicitors and include potential criminal liability.
However, for those who are prepared to accept and carefully manage these risks, there are attractive possibilities to win new work and add value to existing clients.
Book launch: Risk Management in Law Firms – Mitigate Risk and Enhance Firm Success
We were delighted to contribute the concluding chapter to this new title from Globe Law and Business. We were asked to write about ‘Innovation and the opportunities in flexible regulation’.
The book is a worthwhile addition to any law firm library. It covers hot compliance topics including law firm culture, supervision, complaints, conflicts of interests, insurance, AML, cyber security, and many others.
Click here to see the full contents page.
The publishers have kindly offered a 15% discount for our clients and subscribers – please contact us for details.
Legal Ombudsman to change scheme rules – action required
By Carly Fallon
The landscape of client complaints is changing.
Clients will no longer have the luxury of six years with which to bring a complaint, following a review of the current system.
Timing is everything (Scheme Rule 4)
From April 1st 2023 there will be a new time limit for clients to make a complaint to The Legal Ombudsman (LeO). These are:
- one year from the date of the act or omission being complained about; or
- one year from the date when the complainant should have realised that there was cause for complaint.
There are exceptions to this rule and The Legal Ombudsman can extend this time limit where they feel there is just cause to do so (Scheme Rule 4.7).
The changes have been introduced after a consultation period and in a bid to resolve cases brought to the LeO ‘both quickly and with minimum formality.’
Internal complaints process
Law firms will have to revise their client engagement documents and complaints policies. You should already signposting clients to your in-house complaints process from the outset of your engagement.
The SRA also require firms to have details of their complaints process in a prominent place on their website.
ICYMI – That Sinking Feeling: How Many Of These Real Life Mistakes Can You Identify With?
A couple of recent posts on the r/uklaw forum invited lawyers to share their horror stories of mistakes they had made early in their careers.
It made me think back to my early days of practice and how many clangers I made – or came close to – on a daily basis.
There are probably lessons to be learned from these insights:
- we all make mistakes;
- pressure and inexperience make them more likely;
- the importance of proper supervision, and not assuming knowledge;
- most mistakes can be rectified; and
- the worst thing you can do is try to cover up the mistake.
The last one is the most important – it can escalate from an oops-moment into a strike off.
For now, just relish the fact that these things didn’t happen to you.
News and Guidance
- Anti Money Laundering annual report 2021-22 – The SRA continues to step up its AML visits and enforcement processes. As SRA Chair, Anna Bradley, ominously warns firms caught by the Money Laundering Regulations, “now is the time to put your house in order.”
Law Society – New and updated practice notes (may require login)
- Gazette – SRA poised to issue SLAPPs warning
- Gazette – Junior lawyers won’t have to ‘turn in’ bullying workmates
- News – Lack of customer due diligence identified by SRA as main cause of AML breaches
- Q&A – Do I need professional indemnity insurance if my employer is not SRA regulated?
- Updated Guide – UK sanctions regime
- OFSI – General licence for legal fees – note that ‘anyone wanting to make use of these permissions should carefully consider the terms of the General Licence before doing so.’
Sexual Misconduct and the Regulation of Solicitors’ Private Lives
The recording from last month’s webinar is available here (Passcode v&%k$u7V).
Huge thanks to Geoffrey Williams KC for speaking with us about this important topic.
Invitations to November’s free webinar on the Register of Overseas Entities will be sent out shortly. There’s an important impending deadline for overseas owners of UK property.
As always, clients will get first refusal with remaining webinar spaces open to newsletter subscribers.
SRA and SDT disciplinary decisions
- Anthony Gale – 12 month suspension for property solicitor who failed to protect vulnerable client’s interests where the client was a victim of undue influence, financial abuse and fraud.
- James Brookes – criminal solicitor fined £40,000 after acting for a friend pro bono in family proceedings. He was found to have lacked integrity and failed to uphold the rule of law in his handling of the case, in an area of law unfamiliar to him, involving multiple unrepresented lay parties.
- Simon Trees – fined £1,700 for convictions for assault and drink driving.
- Robin Edward Stubbings – sole practitioner fined £2,000 for AML failures, including not having a firm-wide risk assessment in place.
- Surinder Manak – fined £750 for drink driving offence.
- Elliot Parker – paralegal banned from the profession (Section 43 Order) after dishonestly producing false evidence of his legal experience.