FCA to take over law firm AML responsibilities from the SRA—eprivateclient
Chair and partner John Gould has been quoted in an article by eprivateclient discussing the UK government’s plan to transfer law firms’ anti-money laundering (AML) supervision from the Solicitors Regulation Authority (SRA) to the Financial Conduct Authority (FCA).
The article outlines the UK government’s plan to overhaul the AML and counter-terrorist financing (CTF) supervision regime by moving oversight of law firms from the SRA to the FCA, with the aim of strengthening defences against illicit finance. Legal professionals, however, have raised concerns about the practicality and implications of this shift.
John is quoted as saying that the new “Office” of the FCA "will pass its costs on to the professions, and from there into charges. There could be an expensive learning curve and there is a real risk of duplication - dishonesty and misconduct often go hand in hand with AML non-compliance."
Perhaps the FCA will have the confidence and knowledge to focus its efforts away from the endemic failures of firms to deal with routine recording of compliance, and towards disrupting criminal activity... The move creates a potential precedent of the government rationalising over-complex regulation of lawyers by appointing its own agency. This could, in years to come have a broader application.
Experience from the US suggests that one might regret, at some future time, giving government more power over lawyers. The history of the FCA, and the FSA before it, is that it is responsive to Government policy direction - as the events leading to the 2008 banking crisis tend to show.
The full article can be read online at eprivateclient, by subscription only.
About John
John Gould is Chair of Russell-Cooke and partner in the regulation and public law team. He advises regulators, government departments, law enforcement agencies, charities and statutory & professional bodies in connection with complex regulatory issues.
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