What exactly is a ‘proportionate but risk averse’ approach to sanctions compliance?
The Solicitors Regulation Authority (SRA) recently held a live webinar on sanctions compliance. You can find the official recording on YouTube – it is worth a watch for anyone interested in sanctions compliance.
And of course, that should be everyone. Since the regulator has made it clear through its recent guidance notes, keynote speeches and mandatory questionnaire that the profession’s compliance with sanctions is near the top of the regulatory agenda.
The message is that all firms are exposed to sanctions legislation and therefore steps need to be taken to demonstrate appropriate systems and controls are in place.
However, there is a problem for lawyers in knowing when and how far they need to go in checking third parties’ sanctions status.
SRA Diversity Data Collection Exercise 2023
It is almost that time again: the SRA will be conducting its biannual diversity data collection exercise this summer.
With the start date yet to be announced, you will have just four weeks to collect, report and publish your firm’s diversity data.
And don’t forget, it is a regulatory requirement to complete this exercise as prescribed by the SRA (Code of Conduct for Firms paragraph 1.5).
SRA Principle 6 also states that you should “act in a way that encourages equality, diversity and inclusion.”
Learn how to collect, report and publish your firm’s diversity data
Why do lawyers need to talk about menopause?
Rachael Eyre gives some practical tips for law firms.
Peri/menopause may affect 50- 60% of the legal sector work force at some point in their lives.
In 2018 figures shared in the House of Commons showed that 50% of women found doing their job challenging due to menopausal symptoms, and 10% left the workplace altogether.
Not every person going through menopause will have severe symptoms. Everyone is different. Some people may have very manageable symptoms, but for many there are both physical and mental symptoms that can affect day to day life.
ICYMI: COLPs: Are You Ready For The SRA Sanctions Questionnaire? [31 May Deadline]
The regulator of solicitors in England and Wales has announced a new round of sanctions assessments. This takes the form of a mandatory SRA sanctions questionnaire.
The assessment will be sent by email to firms’ Compliance Officer for Legal Practice (COLPs) or authorised signatory. Make sure that your team looks out for the SRA email, and do check your spam filters to ensure you do not miss the 31 May deadline.
Read more about the SRA sanctions questionnaire
ICYMI: Sanctions Checks And GDPR – What’s Your Lawful Basis For Processing Third Party Personal Data?
News and Guidance
SRA Updates
- New strategy focused on enhancing confidence in legal services – This post provides details about the SRA’s new strategy, which includes a range of initiatives aimed at improving the quality of legal services and making them more accessible to the public. These initiatives include greater use of technology, more transparent pricing, and improved support for vulnerable clients.
The post also discusses the SRA’s focus on addressing issues of diversity and inclusion within the legal profession, as well as its plans to increase the practising fees levied upon solicitors.
- Updated guidance: Workplace environment: risks of failing to protect and support colleagues – The updated guidance emphasises the importance of treating all employees ‘fairly and with respect’. The SRA encourages solicitors to foster a culture of openness and transparency, where employees feel comfortable raising concerns about any issues they may be facing. Additionally, the guidance highlights the regulatory obligations that solicitors have to ensure that their workplaces are free from discrimination and harassment:
- Law firm managers (partner level) are obliged to challenge behaviour that falls short of treating colleagues fairly and with respect.
- Firms need to have effective systems and controls to manage the risks of a ‘toxic workplace’.
The SRA has also updated its related case studies, which provide examples of when the regulator will get involved in workplace disputes. Is the SRA at risk of putting itself in the position of arbiter of internal HR issues? Will not every aggrieved law firm employee also put in an SRA report?
- Updated guidance: SRA approach to health issues and medical evidence – The guidance sets out the issues around solicitors’ health issues that affect their ability to practise, or might impact a regulatory investigation. It highlights the importance of ensuring that all parties involved are treated fairly and without discrimination. The guidance provides advice on how to obtain and use medical evidence in these cases.The guidance also covers issues related to data protection and confidentiality, emphasising the need to handle personal data with care and to ensure that it is only used for the purposes of the investigation.
The SRA has also published a list of FAQs to complement the guidance.
Law Society – New and updated practice notes (may require login)
- Ethics feature: Risky business: firm received record fine for anti-money laundering failings – This feature is about a law firm that received a £20,000 fine for failing to comply with anti-money laundering (AML) regulations. It provides details about the regulatory action taken against the firm, the reasons for the fine, and the implications of the firm’s actions for its clients and the wider legal profession. The article also discusses the importance of AML compliance for law firms and the potential risks of non-compliance.
- Updated practice note: Alternative business structures – a comprehensive overview of non-lawyer owned/managed law firms. See our ABS application service for more information about the opportunities for new and existing law firms. We can advise on and help with the practicalities of SRA, CLC, BSB and IPReg applications.
Other Updates
- Legal Services Board (LSB): Call for evidence: Misuse of non-disclosure agreements – The LSB has launched a call for evidence on the misuse of non-disclosure agreements (NDAs) and the role of lawyers in such cases. The LSB is seeking input from legal professionals, regulators, and the public on the use of NDAs in legal proceedings and their impact on access to justice, public trust in the legal profession, and compliance with professional ethical obligations.The call for evidence aims to identify any issues or concerns related to the use of NDAs in legal proceedings, as well as any potential gaps or areas where regulation may be needed to ensure that lawyers meet their ethical obligations. The LSB is also seeking feedback on potential solutions or best practices that could be adopted to address any issues related to the use of NDAs in the legal profession. The findings of the call for evidence will be used to inform the LSB’s ongoing work on improving the regulatory framework for legal services in the UK.
Free webinars
Next session: ‘Ask us anything!’
May’s live webinar will be slightly less structured, as the team tackles your burning compliance and AML-related questions.
Stressed by sanctions? Driven loopy by LSAG? Confused by conflicts?
This is the place to get your questions answered live.
And just in case you are feeling shy on the day, we are canvassing our client firms for their questions in advance. Chances are, someone will have the same question as you!
Save the date: 31 May 2023 at 12pm
As always, clients get priority access, with limited space available. Invitation to be sent in the coming days.
Mediation in Employment Law Settings (recording)
In this fascinating session, Jeremy Phillips KC and James Bromige of Queen Square Chambers took us through this specific form of judicial mediation.
Employment lawyers: do not miss out on this free insight (and CPD!).
Recording: View here use passcode =PT2$sw%
Slides: Download here
Handout: Download here
New LSAG guidance | Recent SRA focus | Client and matter risk assessments (recording)
Jon, Rachael and Carly tackled some of the biggest issues facing law firms’ AML compliance. Are you up to speed with non-proliferation financing and discrepancy reporting? Do you know what to expect from an SRA visit? What do ‘client and matter risk assessments’ mean, and how should you implement them?
Recording: View here use passcode =VQc8mW$
Slides: Download here
SRA and SDT disciplinary decisions
- George Constantine Panagopoulos – struck off for misleading colleagues during an investigation into his expense claims.
- Richard Longton – fined £45,000 after acting for a developer client as well as individual purchasers – many of whom lost their investment. The developer client is the subject of an SFO investigation in relation to the property investment schemes at the centre of this case. Acting on both sides was a conflict of interests and involved a lack of integrity, given that the developer’s interests were placed above those of the investor clients. The conduct was motivated by a desire to keep the firm’s ‘best client’. The solicitor also provided banking facilities through the firm’s client account.
- David Ferraby – rebuked for drink driving offence.
- Unnamed solicitor (Respondent AC) – fined £23,000 for singing a song with ‘sexualised gestures’ in front of junior staff at a Christmas party.
- Nicola Jayne Girardier – experienced non-lawyer struck off for mismanaging a vulnerable client’s affairs over the course of a year. The fee earner used her own money to partly subsidise the client, but failed to notify a supervisor. (The supervisor was also rebuked for failing to supervise an unqualified fee earner.)
- Leanne Danielle Nourrice – fined £1,000 for failing to tell lender clients that purchaser clients were using stamp duty avoidance schemes.
- Alisha Butler – rebuked for client account issues leading to a qualified accountant’s report.
