SRA To Expand Its AML Visits To Continue Competence

In its business plan draft for 2020/2021, the SRA has revealed that in an effort to continue competence, it will be increasing its monitoring of firms’ anti-money laundering (AML) policies.

Following a review of its annual business plan, which followed on from the recent publication of its corporate strategy for 2020-2023, the regulator has unveiled various measure that will help meet its obligations to anti-money laundering.

Measures include expanding AML visits to high risk firms, on a rolling three-hear basis, as well as a sample of lower-risk firms, as well as every month it will analyse policies, procedures and risk assessments from a sample of firms.

The increase in AML visits also means an increase in the budget for such visits, currently at 2.5% of the regulators budget of £70m, it will increase to 3%.

The SRA stated:

“We recognise the importance of not only high standards at point of entry into the profession, but also throughout a solicitor’s practice over many years, so we will also undertake a strategic review of our approach to regulating solicitors’ continuing competence.

“This is likely to be a programme of work that continues over several years.”

To ensure firms meet the transparency requirements, the SRA has promised to increase resources to the review of firms as well as instigate any enforcement if required.

Other activity in 2020/21 includes:

  • A year one evaluation of the STaRs, including an assessment of the equality diversity and inclusion implications for both the public and the profession;
  • Establishing an in-house ‘arms-length’ quality assurance team for all SRA disciplinary work;
  • Undertaking a full review of the fees its charges solicitors and law firms;
  • Researching cyber prevention methods and how other industries/regulators/jurisdictions have responded, “as well as working with key stakeholders to undertake a review of how losses linked to cyberattacks and fraud can be better prevented using technology and innovation”; and
  • Opening an office in Wales – where around 2.6% of practising solicitors and 4% of firms are based – so that “we can work more closely in partnership with different interest groups, including the Cardiff office of the Law Society, on the key issues for Welsh consumers and the profession”.

“The impact of Covid-19 on the profession, consumers and, indeed, the wider economy is likely to be significant and long lasting. There is potential need for greater regulatory activity at a time of this significant financial uncertainty for the profession and law firms, at the same time as the economy is adapting to a post-Brexit transition environment.

“With this in mind, we want to avoid any increases in our part of the practising certificate fees… for the foreseeable future and will work towards this.”

As well as the increase in AML visits, the SRA has stated it will keep the quality of advocacy and criminal practice under review, looking to “enhance our quality assurance” of police station representatives accreditation scheme, with and changes that are required being made during 2021-2022.

Is your firm continuing in its obligations for transparency and competence for AML, especially whilst many are working from home and unable to see clients face to face?

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