AML Failures + solicitors = For those solicitors who wonder whether they are the only ones putting in significant effort to comply with their AML obligations and whether anyone ever notices, the Law Society’s annual report on AML supervision to HM Treasury should be welcome reading.

The Annual Supervisor’s Report, published jointly by the Law Society and the SRA, concludes that there is strong evidence that the majority of solicitors take their compliance obligations very seriously.

Unfortunately, during 2011 there were

• 19 of instances where the failure to comply with AML/CTF requirements were so significant, either in isolation or in concert with other breaches, that cases were referred to the Solicitor’s Disciplinary Tribunal (SDT).

As a result of those cases

• nine solicitors were struck off the roll or refused restoration to the roll,
• while two non-solicitor conveyancers were prevented from being employed by an SRA regulated practice.
• Other solicitors were suspended or received fines up to £10,000.

further details

Serious matters of misconduct are referred by the SRA to the Solicitors Disciplinary Tribunal (SDT), which is an independent tribunal. When considering the outcomes of decisions at the SDT is important to take into account the following issues:

1. • It is rare that a case will be referred simply for a breach of the Regulations, as such the penalties imposed may relate more to another breach of the previous Solicitors Code of Conduct or the current Solicitors’ Handbook.
2. • Penalties may also vary in any given case depending on the seniority of the person involved within the legal practice and their specific involvement in the commissioning of the offences.
3. • Finally, decisions often occur some months or even years after the infringement, which may mean that where a breach occurred in close proximity to the change in the Regulations the penalty may have been more lenient than it would if the conduct was undertaken now.

From SDT decisions in 2011 we have identified:

1. • Two solicitors who were refused restoration to the roll due to convictions under the Proceeds of Crime Act; and
2. • One solicitor who was struck off the roll solely for a conviction under the Proceeds of Crime Act.

With respect to cases which involved breaches of AML obligations and other breaches:

1. • Six solicitors were struck off;
2. • One solicitor was suspended for 2 years and another for 30 months;
3. • Eight solicitors received fines ranging from £2,000 to £10,000;
4. • Two solicitors were reprimanded;
5. • Two non-solicitor conveyancers were prevented from being employed by an SRA regulated legal practice;
6. • No orders were made against two solicitors.

In all cases costs were awarded ranging from £500 to over £150,000.

Read the full Law Society Supervisor’s Report

http://www.lawsociety.org.uk/new/documents/aml/aml-supervisors-report.pdf