Deputy EditorSolicitors Journal

SRA publishes Risk Outlook

SRA publishes Risk Outlook

Money laundering, dubious investment schemes, and the perils of losing information or money to cybercrime are highlighted as risks in the Solicitors Regulation Authority’s (SRA) Risk Outlook.

Money laundering, dubious investment schemes, and the perils of losing information or money to cybercrime are highlighted as risks in the Solicitors Regulation Authority’s (SRA) Risk Outlook.

Published this week, the Risk Outlook for 2019/2020 showed that SRA investigations into most of the nine key areas fell last year compared to last year.

This was apart from cases involving questionable investment schemes, where 30 investigations were opened in the first three quarters of 2019, compared to 27 in the same period in 2018.

The SRA began 172 investigations about anti-money laundering compliance in 2019, compared to 314 in 2018, and in the last five years it has taken more than 60 such cases to the Solicitors Disciplinary Tribunal (SDT), leading to more than 40 solicitors being struck off, suspended from practice or voluntarily coming off the roll.

The Outlook also highlights that new EU money laundering regulations are due to come into force by 10 January 2020, meaning firms need to update their processes to bring them up to date with the new legislation.

The SRA has also pledged to change its processes in line with the new EU and government requirements, including changes to how we approve some individuals under the anti-money laundering regulations.

There were 228 investigations launched into alleged breaches of the accounts rules in 2019, compared to 378 the previous year, with nearly half of these involving a firm failing to account to its client or another party entitled to money.

Misappropriation of client money, accounted for 70 cases of SRA regulatory action – including SDT referrals – in 2019, compared to 96 in 2018; 37 investigations into reports of sexual harassment were launched in 2019, compared to 62 in 2018; and 28 investigations were begun into poorly handled personal injury claims, compared to 40 last year.

Solicitors’ dubious integrity and ethics – which included making false legal aid claims or creating false documents when originals were lost – were also in the spotlight, with 337 such matters attracting regulatory action in 2019, compared to 382 in 2018.

The new Risk Outlook can be viewed here.

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