We were contacted by the firm by email, sadly after the SRA had carried out a desktop review. (Had the firm contacted us when they were given notice by the SRA of the review we could have helped them in answering the questions and assembling the information. As they had not done so, they inadvertently created more problems for themselves.)

The firm had actually subscribed to our OPM package. (Under this the OPM is regularly kept up to date to take account of changes in law, regulation and guidance.) However, the firm had ceased the subscription over a year prior to the SRA inspection and had not taken other action to keep their OPM (which contained the AML policies & Procedures) and their Practice-Wide Risk Assessment (PWRA), (again contained in the OPM,) under review & up to date. This meant that the SRA had found the firm to be deficient.

On that same day as we were contacted, our expert in AML & the SRA Code of Conduct rang them and had a detailed conversations with them. The firm had received a report from the SRA with a Compliance Plan for what the SRA required them to do to become compliant. An Order for our assistance was agreed and sent.

Over the following 6 weeks we worked closely with the firm to ensure that the SRA’s requirements were met. This involved more work than should have been necessary for 2 reasons a) the firm delegated someone with a poor grasp of English to deal with this and b) the person kept copying & pasting wording from the SRA instead of engaging in analysing its own business, its risk matrix and applying that to the PWRA, policies & procedures. However, we succeeded in bringing the firm through the review and were informed by them:

“I am pleased to inform you that the SRA have closed their investigation as they are satisfied with our efforts to meet AML regulations. Thanks so much to you and Paul for your assistance. “

Lessons to be learned:

1. If you don’t have a Practice -Wide Risk Assessment (PWRA) get one ASAP. If & when you do – review it whenever there are changes in law, regulation. Only the firm can do this, as only they will know all of the factors affecting their firm. The name of the reviewer & date of the review should be recorded on the document.
2. AML Policies & Procedures – the same comments as for point a) above are made.
3. Ensure your staff are trained regularly and then carry out an Independent AML Audit to check that your AML policies & procedures are indeed being operated as you expect by your staff on their files.
4. The review, implementation & operation of the firm’s AML (& Sanctions) compliance should not be delegated out to other staff with abrogation of responsibility. It is the responsibility of the MLRO.
5. The SRA are pro-actively carrying out checks on firms they regulate. Expect to be contacted for an assessment.
6. Reach out when contacted by the SRA for the inspection. It may save you time & expense in the long run.
7. The MLRO or MLCO (not a junior) should take responsibility for handling the response to the SRA inspection.
8. Do not panic – there is help for you, the SRA are interested in helping and giving assistance to make you compliant. They will usually agree to reasonable requests for extensions of deadlines

Assistance from HCL

Feel free to contact us for assistance. We have helped numerous firms through the SRA AML inspection process. As well as this, other AML related services we provide are listed below (but we can always bespoke to your need); they are not mutually exclusive, but meet differing requirements of our clients:

OPM – Office Procedures Manual (an up to date OPM which is also compliant with the requirements of Lexcel, CQS & SQM and is kept up to date with quarterly updates)

AML Policy & PWRA Review – a stand alone review

AML Training – one of or on a regular basis

AML Updating Retainer – AML specific updates with training when required

Independent AML Audit – this checks the real world operation of the firm’s AML policies & procedures in the firm and mirrors what the SRA would do

If you would like a complete review of all compliance documentation with a gap analysis & report, we do this. The service we call our Compliance Stress Test. It covers the following areas:

• SRA Code of Conduct
• AML
• Sanctions Regime
• SRA Transparency Rules
• SRA Accounts Rules
• GDPR & Data Protection

Contact Us

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07887 524507