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Law Society hits back against dirty money bill

By Matt Oliver

THE Government faces a battle with the legal profession over plans to crack down on “enabler” lawyers who turn a blind eye to kleptocrats and Russian oligarchs.

Under a new bill proposed by ministers, the Solicitors Regulation Authority (SRA) will get beefed-up powers to hit lawyers and law firms with unlimited fines if they breach dirty money rules.

The changes are aimed at deterring fraud, money laundering and sanctions evasion and are supported by transparency campaigners, who say lawyers currently enjoy almost “unique” protections from some regulations.

In a report due to be published next week, charities Spotlight on Corruption and Global Integrity warn that many law firms are flouting anti-money laundering rules with near impunity.

Currently the SRA, which regulates all solicitors and traditional law firms, can only levy fines up to a maximum of £25,000 and must hand cases that would result in bigger penalties to the Solicitors Disciplinary Tribunal.

That is inconsistent with other legal

‘We have been asking for an increase in our fining powers for some time and support the development’

regulators, ministers argue, which are free to draw up their own sanctions regimes with no upper limit on fines. The Government wants to overhaul the rules to allow for bigger fines.

The plans are opposed by the Law Society, which represents the legal profession. It says it is “extremely concerned” about the SRA gaining more powers and is lobbying MPS for changes.

The Law Society claims there is little evidence that higher fines boost compliance and says it has concerns about the “proportionality” of harshly punishing lawyers over “economic crime disciplinary matters”.

An SRA spokesperson said: “We have been asking for an increase in our fining powers for some time and we would support the development.”

In documents explaining the Economic Crime and Corporate Transparency Bill, the Government said the war in Ukraine had highlighted the legal sector’s “exposure to different areas of economic crime, such as fraud or breaches of the sanctions regime”, as well as the role lawyers must play in “preventing and detecting” criminality.





Daily Telegraph