As part of its commitment to accountability and transparency, the Solicitors Regulation Authority (SRA) is for the first time consulting on its future business plan and budget.
The business plan consultation (which can be viewed at https://bit.ly/30z8KUD) reveals that, in addition to its core work to protect the public and deliver effective regulation of law firms and solicitors, the SRA plans to develop key areas of work including:
- the planned introduction of the Solicitors Qualifying Examination,
- responding to the implications of the Covid-19 pandemic for the legal sector,
- increasing monitoring of anti-money laundering arrangements,
- understanding and supporting the adoption of technology in the legal sector,
- supporting the legal sector through the transition toward the UK’s EU exit, and
- establishing an SRA office in Wales.
The business plan is set in the context of longer-term work to meet the objectives agreed during a previous public consultation on the SRA’s 2020-2023 Corporate Strategy. The three objectives focus on:
- setting and maintaining high professional standards,
- supporting the adoption of legal technology and innovation, and
- understanding emerging opportunities and challenges for the users of legal services and the legal sector.
The business plan consultation will run until 26 August 2020 and takes place, in part, alongside the Law Society’s own consultation on the level of the practising certificate fees for 2020/21 (which runs until 10 July 2020).
As part of this consultation, the SRA is also be asking for views on its proposed principles for managing its Compensation Fund, which is a key part of consumer protection and supports public confidence in solicitor firms and the reputation of the profession. The proposed principles address how the SRA will set future contribution levels in a way that ensures the fund is both sustainable for those who need it and affordable for the firms and solicitors that pay for the fund. These principles are:
- The overriding principle will be to maintain the viability of the fund,
- The SRA will ensure that the professional contributions to the fund are as manageable as possible for those we regulate,
- The SRA will collect the contributions to the fund in a way that is manageable for those they regulate,
- The SRA will be transparent about the fund monies and their management.
As with all things, the devil is in the detail, and the statement above, for example, that the SRA will be “increasing monitoring of anti-money laundering arrangements” could have far more wide-reaching implications for firms than many will realise.
Thus, paragraphs 29, 30 and 31 of the draft plan provide that the SRA “are committed to meeting [their] obligations in legislation to preventing money laundering that involves the solicitors and firms [they] regulate”.
In order to achieve this, the SRA state that they will expanding their AML visits to visit all high-risk firms on a three-year rolling basis as well as visiting a sample of lower risk firms. In addition, every
month they will “call in and analyse a sample of firms’ AML policies, procedures and controls, or their risk assessments” and will undertake a thematic review into tax advice and will start to review the methodology they use to risk rate firms and target their AML oversight, so that they can make changes in future. This will be funded by an increase in the percentage of their budget that they assign to AML-related activities.
For more information on how Infolegal can assist your practice with its AML compliance contact Matthew Moore on 0203 371 1064 or at firstname.lastname@example.org