Disciplinary Record - Brittons Solicitors Limited

Decision - Fined

Outcome: Fine

Outcome date: 29 November 2024

Published date: 19 December 2024

Firm details

No detail provided:

Outcome details

This outcome was reached by SRA decision.

Decision details

Brittons Solicitors Limited (the firm), a recognised body with offices at 2 The Parade, Bourne End, Buckinghamshire SL8 5SY.

Summary of decision

The firm was fined for failing to have in place or to maintain relevant documentation to prevent activities relating to money laundering and terrorist financing as required by the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (the MLRs 2017).

Facts of the misconduct

The firm has been carrying out 'in scope' work since 2011. In June 2023, the SRA undertook an inspection at the firm to assess its compliance against the MLRs 2017. This identified various areas of concern surrounding the firm's compliance with requirements for a documented and compliant firm wide risk assessment (FWRA), policies, controls and procedures (PCPs) and client/matter risk assessment (CMRA) process.

These concerns led to a referral to the SRA's AML investigation team.

It was found that:

1. Between 26 June 2017 and October 2020, the firm failed to have in place a documented assessment of the risks of money laundering and terrorist financing to which its business was subject (a firm-wide risk assessment (FWRA)) pursuant to Regulation 18(1) and 18(4) of the Money Laundering Regulations (MLRs) 2017.
2. Between October 2020 and March 2024, the firm failed to have in place an appropriate FWRA that identified and assessed the risks of money laundering to which it was subject, taking into account all risk factors pursuant of Regulation 18(2) of the MLRs 2017.
3. Between December 2011 and 25 June 2017, the firm failed to establish and maintain appropriate and risk-sensitive policies and procedures relating to customer due diligence measures and ongoing monitoring, reporting, record-keeping, internal control, risk assessment and management, the monitoring and management of compliance with, and the internal communication of, such policies and procedures, in order to prevent activities related to money laundering and terrorist financing, pursuant to Regulation 20(1) of the MLRs 2007.
4. Between 26 June 2017 and March 2024, the firm failed to establish and maintain fully compliant policies, controls, and procedures (PCPs) to mitigate and effectively manage the risks of money laundering and terrorist financing, identified in any risk assessment (FWRA), pursuant to Regulation 19(1)(a) of the MLRs 2017.
5. The firm failed to maintain records of its risk assessment on client files and was therefore unable to demonstrate that the extent of the measures it had taken to satisfy the requirements of Regulations 28(12) and 28(13) were appropriate, as required to Regulation 28(16) of the MLRs 2017.

In doing so, in respect of all three allegations, to the extent the conduct took place between 6 October 2011 and 24 November 2019, the firm:

• breached Principles 6 and 8 of the SRA Principles 2011, and
• failed to achieve Outcomes 7.2 and 7.5 of the SRA Code of Conduct 2011

and to the extent the conduct took place from 25 November 2019

• breached Principle 2 of the SRA Principles 2019, and
• breached Paragraphs 2.1(a) and 3.1 of the SRA Code of Conduct for Firms 2019.

Decision on sanction

The firm was directed to pay a financial penalty of £18,173 and ordered to pay costs of £1,350.

This was because the firm's conduct was serious by reference to the following factors in the SRA Enforcement Strategy:

• The findings relate to breaches of the MLRs 2017, which protect the public from the serious consequences of money laundering and terrorist financing. The associated risks were heightened given the high proportion of the firm's work that was 'in scope' of the MLRs 2017.
• Its conduct was a breach of its regulatory obligations which persisted for longer than was reasonable. The firm failed to have proper regard to the SRA's guidance and warning notices which explained what was required, the risks that failure to comply with AML requirements posed, and the regulatory consequences of failing to comply.
• The firm was responsible for its own conduct which was serious and had the potential to cause harm to the public interest and to public confidence in the legal profession.

In view of the above, the firm's conduct was placed in conduct band C which has a financial penalty of 1.6% to 3.2% of annual domestic turnover. In light of these factors, the firm's conduct was placed at band C2 (2% of annual domestic turnover).

The following mitigating factors were considered:

• The firm co-operated with the SRA.
• The firm had taken remedial action.
• There was no evidence that actual harm had materialised.

SRA Principles and Outcomes breached

SRA Principles 2011

Principle 6 - You must behave in a way that maintains the trust the public places in you and in the provision of legal services.

Principle 8 - You must run your business or carry out your role in the business effectively and in accordance with proper governance and sound financial and risk management principles.

SRA Code of Conduct 2011

Outcome 7.2 - You have effective systems and controls in place to achieve and comply with all the Principles, rules and outcomes and other requirements of the Handbook where applicable.

Outcome 7.5 - You comply with legislation applicable to your business, including anti-money laundering and data protection legislation.

SRA Principles 2019

Principle 2 - You act in a way that upholds public trust and confidence in the solicitors' profession and in legal services provided by authorised persons.

SRA Code of Conduct for Firms 2019

Paragraph 2.1(a) - You have effective governance structures, arrangements, systems and controls in place that ensure you comply with all the SRA's regulatory arrangements, as well as with other regulatory and legislative requirements, which apply to you.

Paragraph 3.1 - You keep up to date with and follow the law and regulation governing the way you work.