First of all, just a quick word of thanks. We’ve had some really positive comments about the newsletter recently, which is really appreciated – you know who you are. Writing this thing sometimes feels like shouting into the void, so it’s always lovely to hear that it has been genuinely helpful – that’s the goal!
Speaking of which, would you please take a minute to help us to make COLP Insider better for you? A small prize is up for grabs…
It’s been an interesting couple of weeks. The SRA is under pressure on several fronts: budget, performance, law firm collapses, AI, competence, AML and sanctions data collection. So, a quiet spell at The Cube then.
In this edition, we look at Taylor Rose’s £160k fine and what it tells us about client account compliance. Sophie tackles the SRA’s proposal for mandatory annual ethics discussions, and why this could be genuinely useful if firms take it seriously. We also have a write-up of our recent “When the SRA comes knocking” webinar, with practical points on audits, investigations and regulatory contact.
The big news this week is the SRA’s proposed cash call. Our view is that if the profession is being asked to fund a regulatory reset, it is entitled to ask what it is paying for, what will improve, and how the regulator will be held to account.
In News and Guidance, we also cover the LSB’s latest pressure on the SRA, the profession’s call for clearer rules on AI in court, the deadline for non-practising solicitors to stay on the roll, and the SRA’s AML and sanctions data collection exercise. Compliance Corner looks at the practical implications of a high-value UK property purchase by an overseas company.
We’re also flagging the recording of our SRA investigations webinar, our new Ethics and the SRA Principles course, and the usual Disciplinary Watch round-up.
Have a great weekend
Jon and the team
Let’s talk about ethics, baby
The SRA wants solicitors to talk about ethics every year. Cue the eye rolls?
Not so fast. Sophie Cisler looks at the SRA’s continuing competence consultation and argues that, if done properly, facilitated ethics discussions could be genuinely useful. Real ethical problems are rarely neat, obvious or theoretical. They emerge in pressure, drift, awkward clients, commercial demands and “everyone does it” thinking.
This article explores how firms can make ethics discussions practical, psychologically safe and relevant to the work actually landing on people’s desks.
How to avoid a £160k SRA fine (and it’s not AML compliance)
A high-profile firm has been fined £160,000 by the SRA. And no, this one is not about AML.
The decision is a reminder that fast-growing, complex firms need systems that can keep pace with the business. The issues were related to legacy client account management – residual client balances, unreconciled client money etc. Not uncommon in a post-merger period.
This article looks at what went wrong, why the fine was so significant, and what other firms can learn from it before the SRA comes knocking.
The SRA Business Plan 2026-2027: If the profession is paying for the reset, it deserves accountability
The SRA is proposing a 29% budget increase for 2026/27. The profession is being asked to pay more through practising certificate fees, firm fees and compensation fund contributions.
But the real question is not just how much solicitors are being asked to pay. It is what they are being asked to pay for.
This article looks at the SRA’s proposed “reset”, the pressure created by major firm failures, the continuing client money debate, and why any significant increase in cost must come with proper accountability.
Webinar write up – “When the SRA comes knocking: how firms should respond to audits, investigations and regulatory contact”
What should you do when the SRA gets in touch?
Our latest webinar looked at audits, investigations, supervisory visits and regulatory contact from the people who have seen the process from both sides. We covered how to respond to information requests, how to avoid making things worse, when to involve senior management, and why the first response often sets the tone.
This write-up pulls together the key practical points for COLPs, COFAs, MLROs and anyone likely to be dragged into the room when the regulator appears.
News and guidance
Tax adviser registration: conveyancers will be caught, others too
New HMRC registration rules go live on 18 May 2026. Under the Finance Act 2026, anyone who “interacts” with HMRC about someone else’s tax affairs and is paid for doing so may need to register as a tax adviser.
Importantly, HMRC’s view is that this can include firms submitting SDLT calculations on behalf of clients, so this is likely to catch many residential conveyancing firms. It may also apply where firms manage a client’s tax affairs, for example as an executor or deputy.
The SRA says firms under AML supervision can register by applying for an Agent Services Account and uploading proof of their status, such as a PDF copy of their Solicitors Register entry showing the SRA number and office address.
There is a three-month transition period: from 18 August 2026, HMRC will not accept communications on a client’s behalf from anyone who is not registered as a tax adviser.
N.B. This is separate from notifying the SRA that you are a tax adviser under the Money Laundering Regulations, so firms should not assume they are already covered!
Terminating a retainer: new SRA guidance
The SRA has published new guidance on when a firm can terminate a client retainer, plus a short case study note.
To be honest, this shouldn’t be entirely new: once you have accepted a retainer, you cannot simply walk away because the file has become difficult, uneconomic or uncomfortable. Unless the retainer says otherwise, the common law treats it as an entire contract to conduct the matter to conclusion. To terminate, you need a “good reason” and you must give “reasonable notice”.
The SRA gives examples of good reason, including where continuing to act would breach legal or professional obligations, where there is a conflict, where the client insists on an unarguable submission to the court, where AML rules require termination because CDD cannot be completed, or where the client has misled the court and will not correct the position.
Other possible examples include inability to obtain clear instructions, breakdown in trust and confidence, offensive or discriminatory behaviour, failure to provide funds for disbursements, or failure to pay a reasonable sum on account in contentious work.
The practical point is documentation. Make sure you record your reasonable reasons for termination and the steps you took to protect the client’s position.
The case study is also worth a look. It distinguishes between contentious and non-contentious work on payments on account, and makes the important point that a client ignoring advice is not, by itself, usually enough to justify termination. If the client wants to take a different strategy, you may still need to act unless the proposed arguments are not properly arguable.
SRA performance: LSB turns up the pressure
The Legal Services Board has issued a pointed statement on the SRA’s regulatory performance. With the deadline approaching for the SRA to comply with the LSB’s Axiom Ince directions, the oversight regulator has asked the SRA to commission an independent external audit of its compliance, with a report due to the LSB by the end of June. The LSB also says it is “deeply concerned” about PM Law, with combined client money losses from Axiom Ince and PM Law now standing at around £100m. It will use formal information-gathering powers to obtain further information about how the SRA is handling known higher-risk firms.
The line that jumps out is that the SRA is currently subject to three concurrent statutory enforcement measures, which the LSB describes as exceptional in the history of legal services regulation. That is more than background noise. It is a significant escalation in oversight of the regulator itself.
For firms, this is all heading in one direction: more proactive supervision, more focus on client accounts, and more focus on financially unstable or structurally risky firms. The SRA is under pressure to show that it can spot risk earlier. Firms should assume that, in turn, the SRA will expect them to evidence their own grip on governance, client money, AML, supervision and financial stability.
AI in court documents: clearer rules are coming
The Law Society has called for clearer rules on how AI can be used in preparing court documents. This feeds into the Civil Justice Council’s work on whether procedural rules are needed for AI use by legal representatives in court documents, including statements of case, skeleton arguments, witness statements and expert reports.
The CJC’s interim paper suggests that, in some circumstances, legal representatives may need to make a declaration where AI has been used. The paper also repeats the core point from judicial guidance: legal representatives remain responsible for the material they put before the court and must independently verify accuracy, including AI-generated research or citations.
This is not a reason to ban AI in litigation teams. It is a reason to put proper controls around it. Firms should be clear about what tools may be used, what they may be used for, what must never be entered into public tools, and what checks are required before anything AI-assisted reaches a client, opponent or court. The policy should be backed by training, supervision and file-level evidence where appropriate.
Staying on the roll: deadline 28 May
A reminder for non-practising solicitors: the application window to remain on the roll closes on 28 May 2026. Solicitors without a practising certificate must apply between 1 April and 28 May and pay the £10 administration fee.
If you miss the window, you will be removed from the roll after it closes. To return, you would need to complete screening and background checks and apply for restoration.
AML and sanctions data collection: start preparing now
The SRA has updated its page on the annual AML and sanctions data collection exercise. The form opens on 29 June, and compliance officers will be contacted directly. Firms will need mySRA access and multi-factor authentication in place before they can submit.
All regulated firms must provide information about work within scope of the Money Laundering Regulations, contact or involvement with the sanctions regime, designated persons, and suspicious activity reports to the National Crime Agency. Firms that do not carry out relevant work can submit a nil return, but they still need to respond if contacted. The SRA is clear that completing the form is a regulatory requirement and failure to do so may lead to regulatory action.
Do not leave this until the deadline. The SRA has published a specimen questionnaire, and it is worth reviewing it now. Check who in the firm has the right mySRA role recorded, whether your authentication app works, and whether you can answer the questions without scrambling across case management, finance and compliance records. The SRA says it will accept estimates where exact figures are not available, but “best efforts” still means a reasoned, evidenced return.
You might also like…
Some thoughts on AI agents for law firms
AI agents are coming for legal services. Not in a vague “the robots are replacing lawyers” way, but in a very practical sense: triage, drafting, supervision, client communication, workflow, compliance, business development and back-office operations.
In this LinkedIn article, Jon explores what AI agents could mean for law firms and for JBL Compliance. The question is no longer whether AI will affect legal practice. It is where firms choose to use it, how they control it, and whether compliance teams should be involved before the tools become embedded.
The SRA outsourcing ruse
Jayne Willetts has raised an important point about SRA investigations being outsourced to external law firms, and whether firms under investigation are being given sufficiently clear information about who is actually contacting them.
Since Jayne published her post, the Law Gazette has reported that the SRA has told its panel firms to amend letters where correspondence may have given the misleading impression that the person writing was an SRA investigation officer. That is a pretty significant development.
There may be perfectly sensible reasons for the SRA to use external firms in some investigations. But transparency is important (as we are constantly reminded). Firms dealing with regulatory correspondence need to know who they are dealing with, what their status is, what powers they have, and how confidential or commercially sensitive information is being handled.
Compliance corner: Overseas client, UK property, high value purchase
Q: Can we act for an Irish company buying a multi-million pound UK property if it is not yet registered on the Register of Overseas Entities?
A: You are right to flag the ROE point, although I would address the broader risk picture in the round.
A Republic of Ireland company is an “overseas entity” for these purposes, so it will need to register with Companies House and obtain an Overseas Entity ID before it can be registered as proprietor of UK land. Overseas entities wanting to buy, sell or transfer UK property must register and disclose their registrable beneficial owners or (or managing officers in some cases).
From an AML perspective, I would not treat ROE registration as a substitute for your own due diligence. It is a separate legal requirement and a useful transparency check, but your file still needs to evidence that you have identified and verified the client, understood its ownership and control structure, assessed the matter risk, and satisfied yourself on source of funds and source of wealth. Basically, your core requirements under the Money Laundering Regulations and LSAG….
This is not legal advice. If you have a question you would like us to answer in this section, feel free to send it to info@jblcompliance.com
New JBL training resources
Ethics and the SRA Principles
With the SRA consulting on mandatory annual ethics discussions, now is a good time to get your team talking about professional judgement, not just rule-following.
Our new Ethics and the SRA Principles course is designed as a practical introduction to ethical decision-making in legal practice. It looks at how the SRA Principles apply in day-to-day situations, why small decisions can have serious regulatory consequences, and how people across the firm can recognise when something does not feel quite right.
It works well as Day 1 induction training, a refresher for existing staff, or a way to kick-start a wider team discussion about ethics.
Available now on the JBL LMS.
This course is available as a one-off purchase or as part of an access-all-areas subscription. It is also included for COLP Help Gold retainer clients.
Contact us about group licences for your firm
Note: A big ‘thank you’ to those who have taken the time to give us feedback on our new training courses – we are so pleased to hear that you are finding them practical and useful.
An update for our COLP-help Gold clients: we have now added our very popular AML workshop (November 2025) to your user areas – ideal for your MLRO/MLCO, COLP and COFA to gain a further insight into the building blocks of this all-important cornerstone of your firm.
- Furthermore, we have also added 6 of our most popular webinars from the last 12 months, including:
- AML: Anything but conveyancing! (April 2026)
- Compliance Officer (COLP and COFA) SRA Thematic Review (February 2026)
- Signing with confidence – Mastering client account reconciliations for COFAs (January 2026)
- Getting AI right: A practical guide for legal professionals) (June 2025)
- Wellbeing in the law (April 2025)
- When the SRA comes knocking – SRA audits and investigations (May 2026)
More courses and recordings will follow, along with the launch of our Insights feature (which answers specific compliance questions ‘in a nutshell’).
Watch this space!
Free CPD
Next free webinar: SRA authorisation — new firms, ABSs, compliance officers and ownership changes
We are planning our next free webinar for Wednesday 3 June at 12pm.
This session will focus on the authorisation issues that keep cropping up in practice: applying for a new law firm or ABS, changing COLPs, COFAs, MLROs and MLCOs, converting an existing firm to an Employee Ownership Trust, dealing with ownership changes, and understanding when SRA approval is needed.
We will keep it practical. Expect a walk-through of common scenarios, the forms involved, timing traps, BOOM/AML approval issues, and the points that tend to slow applications down.
More details and registration link to follow.
Recording: When the SRA comes knocking
The recording of our latest webinar is now available.
We looked at what happens when the SRA contacts your firm: audits, AML visits, thematic reviews, information requests, investigations and enforcement. The panel shared practical advice on how to respond well, avoid common mistakes, manage internal communications, and keep the regulator’s concerns in proportion.
Useful for COLPs, COFAs, MLROs, managing partners and anyone who might be involved in responding to the SRA.
Passcode: ?px0oG1#
Recording available for free until 28 May 2026.
Disciplinary watch
Michael Carl Lillywhite — struck off for backdating a private client document
Michael Lillywhite, a private client solicitor and fixed-share partner, was struck off after the SDT found dishonesty in two separate client matters.
In one matter, he created and backdated a Memorandum of Appropriation so that it appeared to pre-date completion of a property sale. In another, he sent a misleading email to a client about a will that had previously been sent to the wrong address.
Joseph Dawson — struck off after trying to cover up a missed deadline
Joseph Dawson was struck off after creating a letter with a false date to suggest that disclosure documents had been sent on time. The letter was then sent nearly a month later, with an email asserting that it had previously been sent. He also misled his employer by confirming that disclosure had taken place around the date shown on the original letter, in order to show compliance with a directions order and court deadline.
Every compliance team should use this sort of case in supervision and training. The dangerous moment is often not the original mistake; it is the decision to conceal it.
Rachael Catherine Worthington — struck off after misleading clients and insurer
Rachael Worthington was struck off by agreed outcome after admitting dishonesty across several probate dispute matters. The misconduct included telling clients and a legal expenses insurer that claims had been issued when they had not, giving false updates about court progress, failing to tell a client that a failure to issue had resulted in an adverse costs order, and misleading another client about service of proceedings and an agreed extension.
Undiga Emuekpere — false attendance note, but no strike-off
Undiga Emuekpere was suspended for two years after the SDT found that she had created a false and misleading attendance note in response to a Legal Ombudsman complaint. The note suggested that costs had been discussed with the client at a meeting, including matters which the tribunal found could not have been discussed in the way recorded.
Maame Adjoa Doku Djan-Krofa — failure to redeem charges and breach of undertaking
This case is a useful warning for conveyancers. Mrs Djan-Krofa admitted failing to perform an undertaking to discharge or redeem charges secured against a property on or before completion. The SDT also found that she had provided inaccurate information when telling the buyer’s solicitors she would chase lenders for confirmation of discharge, when payments had not yet been made. She also admitted failing fully to cooperate with the SRA’s investigation.
The tribunal did not find dishonesty proved, and imposed a 12-month suspension suspended for 24 months, together with a £20,000 fine and a restriction requiring the firm to employ an unrelated finance director.
John Enright — section 43 order for sexual misconduct in the workplace
A facilities assistant was made subject to a section 43 order after sexually motivated conduct towards junior female employees. The SRA described a clear and calculated pattern of behaviour over time, targeted at junior female staff, which made them feel vulnerable and uncomfortable. The SRA also noted that he initially denied aspects of the conduct before admitting it when presented with evidence.
This is a reminder that workplace culture is regulatory territory. Firms need clear routes for junior staff to raise concerns, proper escalation, and confidence that complaints about inappropriate behaviour will be taken seriously.
Anthony Burns — struck off after failing to comply with Legal Ombudsman and court orders
Anthony Burns was struck off after the SDT found all allegations proved on unchallenged evidence. The case involved failures to comply with a Legal Ombudsman final decision, failures to comply with court orders obtained to enforce that decision, misleading information in professional indemnity proposal forms, and failure to comply with further court orders. He did not engage with the proceedings.
Ettinger and Vickers — £13,901 AML fine
Ettinger and Vickers was fined £13,901 following an AML desk-based review. The SRA found that the firm had no documented firm-wide risk assessment between June 2017 and December 2025, no compliant AML policies, controls and procedures for a substantial period, and insufficient client and matter risk assessments until January 2026.
The decision is another example of the SRA treating historic AML gaps as current regulatory issues. The firm received credit for remediation and cooperation, but the SRA still assessed the conduct as “more serious” because the requirements had been in force since 2017 and the failings formed a pattern.
Regency Solicitors — £6,000 AML and Accounts Rules fine
Regency Solicitors was fined £6,000 after an AML Proactive Supervision review. The firm failed to have an appropriate firm-wide risk assessment from June 2017 to January 2026, failed to establish and maintain compliant AML policies, controls and procedures, and in three of six files reviewed failed to keep accurate, contemporaneous and chronological client ledgers.
Hugh Williams Limited — £5,705 AML fine
Hugh Williams Limited was fined £5,705 after the SRA found that, on six out of six files reviewed, the firm could not demonstrate that it had properly assessed client and matter risk under Regulation 28 of the Money Laundering Regulations.
This is the classic current AML enforcement pattern: not necessarily evidence of actual money laundering, but an inability to show that risk was assessed at file level. If your matter risk assessment process is informal, inconsistent or not recorded, assume it will not survive an SRA review.
Independent AML audits
Law firms must ensure the effectiveness of their AML controls through regular audits. An independent AML audit is crucial for identifying gaps in your firm’s anti-money laundering controls and ensuring adherence to regulatory standards.
Our expert team conducts thorough reviews of your AML systems and processes, providing actionable insights and recommendations to strengthen your firm’s compliance framework. Stay compliant, avoid regulatory penalties, and maintain the trust of your clients.
Included in the audit:
- In-depth analysis of AML policies and controls
- Team interviews
- File reviews
- Customised report and recommendations
- Debrief
Formats Available: Online | In person | Hybrid
Act Now: Contact us for a free consultation and safeguard your firm against AML risks
Crowdfunding – is it worth the risk?
Crowdfunding can be a useful way for clients to raise money for start-ups, property projects, community schemes and new ideas. But for law firms, it can also create a messy source of funds picture.
In this article, Liz looks at why crowdfunding is a higher-risk area, what makes pooled contributions difficult from an AML perspective, and how firms can take a proportionate, risk-based approach before deciding whether they are comfortable acting.
Navigating the agentic AI frontier: a compliance angle
Agentic AI promises something beyond ordinary prompt-and-response tools: systems that can set goals, plan actions and coordinate workflows with minimal human input.
But where does that leave supervision, professional authorisation, junior lawyer training and accountability?
Ed Marshall looks at the compliance risks behind the next wave of legal AI — from the “verification nightmare” to supervision problem.
Everyone’s a winner in the Dentons AML case!
The Court of Appeal’s Dentons AML judgment has been described variously as a win for Dentons, the SRA and the profession. But is it really that simple?
Sophie unpacks what the decision actually says about AML breaches, professional misconduct and the “seriousness” threshold.
