Welcome to the last COLP Insider before we take a short summer break.

This edition is not especially beach-friendly, I’m afraid — although that may depend on your level of geekery.

This week’s blogs cover three quite different sides of running a law firm well. We look at how carefully structured referral arrangements can turn rejected enquiries into a commercial opportunity; what the COLP and COFA roles actually require in 2026; and the experiences of Victoria Jordan, JMW’s AML and SRA Accounts Rules Partner, who has seen compliance from both the regulator’s and the law firm’s side.

Before everybody disappears, a reminder that bookings are open for our next COFA Masterclass, taking place in Birmingham on 7 October. Sean Hankin and Liz Bond will lead a practical, full-day course covering the Accounts Rules, oversight, breach decisions, management information, reporting and the realities of holding the COFA role. The cost is £495 plus VAT. Email sam@jblcompliance.com to reserve a place.

That is all from us until September. We hope you manage to take a proper break.

Jon and the team

Referral arrangements: useful, commercial and compliant

Law firms turn away more valuable enquiries than they sometimes realise. The work may fall outside the firm’s expertise, capacity or risk appetite, but that does not necessarily mean the commercial opportunity has to disappear.

A properly structured referral arrangement can give the client a better route forward while allowing the referring firm to retain some value from the relationship. Our article covers transparency, financial interests, client choice, informed consent, due diligence, monitoring and the limits of non-poach provisions. It also includes a practical example of how a commercial firm could handle occasional private-client enquiries.

If you want help finding suitable referral partners or putting a compliant structure around an existing relationship, we can help.

Read: Can solicitors receive referral fees under the SRA rules?

What it means to be a COLP and COFA in 2026

Appointing a capable COLP or COFA is not the same as creating an effective compliance function. The firm must still give that person the authority, information, time, resources and support needed to do the job properly.

Based on Jon and Ed’s recent Bournemouth Law Society conference session, our new article looks at the practical structure surrounding the roles. It covers reporting lines, management information, independence and influence, continuous Accounts Rules oversight, deputy arrangements, training and the records that demonstrate active judgement.

The central point is that the compliance officer is part of the firm’s governance, but they need a system built around them. They are not a personal guarantee that nothing will ever go wrong.

Read: What it means to be a COLP and COFA in 2026

Compliance spotlight: Victoria Jordan of JMW

What happens when someone moves from investigating law firms for the SRA to leading compliance within a large, full-service practice?

Victoria Jordan, AML and SRA Accounts Rules Partner at JMW, joined us for a candid discussion about that change in perspective. She explains why senior management support needs to be visible, how JMW uses trainee seats in its risk and compliance team and why no compliance officer should be expected to know everything.

The conversation also covers preparations for FCA supervision of AML, client money reform, compliance fatigue, proportionate training and the risks created when confident AI outputs are accepted without enough human scrutiny.

Read: Compliance spotlight – an interview with Victoria Jordan of JMW

News and guidance

The LSB review: another round of regulatory reform

The independent review of the Legal Services Board, led by John Lloyd, has concluded that the oversight regulator has lost strategic clarity and has not demonstrated enough impact. It calls for a more pragmatic, proportionate approach and for the LSB to play a stronger role in system-wide reform.

The review does not immediately rewrite any SRA rules. Its significance is more political. It gives fresh momentum to a familiar argument that the current regulatory structure is fragmented, difficult for consumers to navigate and overdue for change.

Read the government’s independent review of the Legal Services Board

Consumer Panel makes the case for a single regulator

In a similar vein, the Legal Services Consumer Panel has called for a single, independent legal regulator. Its case is that eight frontline regulators, an oversight regulator and a separate complaints body create complexity, gaps and inconsistent consumer protection. That’s difficult to argue against.

Even though this is an observation from a relatively lightweight body, it is another sign that debate is moving beyond how the existing bodies should perform and towards whether the present architecture should survive at all.

Read the report

SRA publishes in-house ethics case studies

The SRA has published three case studies to help in-house solicitors apply their duties on conflicts, confidentiality and independence. The scenarios cover an in-house team asked to represent both an employer and an employee named as co-respondents in a tribunal claim, a solicitor moving to an employer that deals with their former client, and commercial pressure to approve a contract without enough time or evidence of proper internal sign-off.

The guidance stresses the need to identify the client, assess whether interests may diverge, explain professional duties to the employer, resist inappropriate pressure and keep a clear written record of the decision. It is useful reading for private-practice solicitors too, particularly where a firm is advising connected parties or recruiting somebody with detailed knowledge of a former client.

Read the SRA’s in-house case studies.

Law Society updates whistleblowing practice note

The Law Society has updated its practice note on implementing whistleblowing arrangements. It brings together firms’ reporting obligations under the SRA Codes, the roles of the COLP and COFA, protection under the Public Interest Disclosure Act 1998 and practical guidance on building a culture in which people can raise concerns.

Read the Law Society practice note on implementing whistleblowing arrangements.

Law Society responds to reform of solicitors’ billing

The Civil Justice Council is considering a substantial overhaul of Part III of the Solicitors Act 1974. The proposals include removing the distinction between contentious and non-contentious business costs, clarifying the meaning of “fair and reasonable” and introducing a graduated system for resolving bill disputes, with the Legal Ombudsman taking a larger role in lower-value cases.

The Law Society agrees that reform is needed but is concerned about diverting more disputes to the Legal Ombudsman without stronger evidence and safeguards. It says solicitors should still be paid for at least some work while a costs complaint is unresolved, unmeritorious challenges must be discouraged, and any new principles should not create fresh satellite litigation. The working group’s final report is expected in 2027.

Read the Law Society’s response on reform of the Solicitors Act 1974, Part III.

Two practical Law Society answers on sanctions and trust CDD

Two new Law Society Q&As address common client-verification problems. Where a client is a possible sanctions match, the firm should compare its identity information with the UK Sanctions List, obtain further identifiers where needed and record why it concludes that a match is false. A possible genuine match should be escalated under the firm’s sanctions procedure, with no prohibited activity undertaken while the position is investigated. OFSI reporting and separate money-laundering reporting obligations may also need to be considered.

For trusts, firms must understand the full ownership and control structure and identify the beneficial owners, including the settlor, trustees, beneficiaries or class of beneficiaries and anyone exercising control. The extent of verification is risk-based, but the firm should be able to show what it did and why its measures were reasonable.

Read the Law Society’s Q&A on a possible sanctions match and its Q&A on identifying and verifying the beneficial owners of a trust.

SRA proposes tighter controls on third-party litigation funding

As we reported in the last edition, the SRA has opened a consultation on new protections for consumers whose claims are funded by third parties.

The proposals go well beyond better wording in the client-care letter. They include new conduct requirements, a prescribed plain-English funding information document, prompt notification to the SRA, a detailed risk assessment approved by senior management and the compliance officers, six-monthly review, and an orderly closure plan where specified conditions apply.

The consultation closes on 17 September 2026. Firms working in this area should compare the proposals with their current governance now.

Read the consultation and the SRA’s current guidance on using or arranging third-party litigation funding.

ICO consults on its corporate strategy

The ICO is consulting on a draft strategy for the transition from the Information Commissioner’s Office to the new Information Commission under the Data (Use and Access) Act 2025.

The strategy places children’s data, trustworthy AI, responsible use of data in public services and cyber resilience among its regulatory priorities. It also promises more streamlined services, stronger use of data within the regulator and investment in workforce capability and culture, within a proposed annual budget of £116 million.

The consultation closes at 23:59 on 23 August 2026.

Read and respond to the ICO corporate strategy consultation.

You might also like…

AI capability has arrived. Adoption is now the contest

Ed Molyneux argues that the main constraint on legal AI is no longer access to capable tools. It is the willingness and ability of firms to redesign work around them. The article is a useful antidote to both breathless product announcements and the idea that buying a shiny new thing (that’s technical speak by the way)  amounts to transformation.

Read the article in Today’s Conveyancer.

Diversity champion barrister suspended for plotting gangland hit

A barrister once celebrated by the Bar Council as a social mobility success has been suspended after being found guilty of helping a gangster plot violent revenge. RollOnFriday has the extraordinary story – one that reads more like a crime drama than a disciplinary case.

Read the story

What to do this month

Use the quieter weeks to make compliance easier in September

August does not have to become a grand compliance improvement project. Very often, one well-chosen repair is more useful than a list of 30 good intentions that remains untouched until Christmas.

Start with the point of friction people already complain about. It might be a client and matter risk assessment that invites copy-and-paste answers, a policy that no longer reflects how the firm works, or an audit action that keeps moving to next month.

Six jobs are particularly well suited to the summer:

• Update one stale policy against the current rules and guidance, then check that the forms, templates and training say the same thing.
• Test staff knowledge with a few realistic scenarios. A short discussion about what people would actually do is more revealing than another read-and-confirm exercise.
• Close overdue file-review, audit or accountant’s-report actions and record the evidence.
• Review the breach, complaints, claims and residual-balance records together. Repeated small issues often tell a more useful story than a single dramatic event.
• Check holiday cover for the COLP, COFA, MLRO and other key control roles. Make sure deputies can reach the information, systems and senior people they may need.
• Respond to a consultation that affects the firm. The SRA’s litigation-funding consultation closes on 17 September.

Compliance corner: Does our COLP need a deputy while they are on holiday?

Q: Our COLP is taking three weeks off in August. Do we have to appoint a temporary COLP or notify the SRA? We have other partners in the office, but nobody is formally named as the deputy.

A: An ordinary holiday does not, by itself, require the firm to appoint another SRA-approved COLP or notify the SRA that the role holder is away. The approved COLP remains in post.

That does not mean the function can simply pause for three weeks! The firm remains responsible for complying with its regulatory obligations and for enabling the COLP to discharge the role. Urgent issues still have to be identified, escalated and, where appropriate, reported. The same applies to the COFA’s oversight of the Accounts Rules: reconciliations, transfers, shortages and other controls continue while somebody is on leave – arguably, that is the harder position to cover.

A deputy does not need to become a temporary regulatory office-holder for routine cover. The arrangement does, however, need enough substance to work. Before the holiday, agree:

• who will receive and assess potential breach reports;
• who can obtain finance, complaints, claims, HR and file information;
• who can contact the COLP if something genuinely cannot wait;
• who can reach the managing partner or board;
• who will keep a record of decisions and actions; and
• how the returning COLP will be briefed.

The SRA’s compliance officer thematic review found that 44 per cent of the firms it visited had no deputy. The rules do not prescribe a deputy in every firm, but the finding is a useful warning about resilience. A deputy on paper is not enough either. They need access to information, authority and a clear escalation route.

However, three weeks’ annual leave is very different from the role holder resigning, ceasing to be able to perform the role, or being absent for an uncertain and extended period. In those circumstances, the firm should consider its notification and approval obligations promptly and speak to the SRA where the position is unclear.

The practical test is “Can the firm still spot, assess and respond to a serious issue whilst the compliance officer is away?” If the answer depends on one person checking emails from a sun bed, the cover arrangement needs a bit of work.

Read the SRA’s compliance officers thematic review and the SRA Code of Conduct for Firms.

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

Free CPD

Recording: SRA Accounts Rules and COLP and COFA reforms

Our recent webinar examined the SRA’s proposed changes to accountants’ reports and the restrictions on who may act as COLP and COFA. The discussion moved beyond the draft wording to the practical questions firms are now asking about power, influence, succession planning and the risk of distancing compliance officers from real decision-making.

The recording is available free for 14 days. It will be particularly useful for managing partners, COLPs, COFAs, finance directors and risk teams considering whether their current governance arrangements may be affected.

Watch the recording

JBL Compliance training resources

AML Building Blocks: half-day recording

AML Building Blocks gives law-firm staff a clear route through the parts of the Money Laundering Regulations they use in practice. The half-day recording covers the firm-wide risk assessment, policies and controls, client and matter risk assessment, customer due diligence, beneficial ownership, enhanced due diligence, politically exposed persons, sanctions, source of funds and wealth, ongoing monitoring and reporting concerns.

It is suitable for fee earners who need to understand the reasons behind the process, as well as compliance teams looking for a structured refresher. The emphasis is on applying the rules to real legal work rather than reciting them.

The course is included for users of the JBL Compliance training platform or as a standalone licence.

View AML Building Blocks.

Free Compliance Insight: what if the client is based abroad?

An overseas client does not replace the normal onboarding process. Conflicts, identity, scope and client care still come first. In this short insight, Sophie covers practical identity arrangements, geographic and FATF risk, enhanced due diligence and sanctions, the limits of English-law advice, payment routes and communications.

It is a concise refresher for firms handling occasional or regular cross-border matters.

Watch What do I need to think about when my client is based abroad?.

COFA Masterclass

A practical day for people responsible for client money

We are now taking bookings for our next in-person COFA Masterclass on Wednesday 7 October 2026 in Birmingham. The full-day course will be delivered by Sean Hankin and Liz Bond, two former SRA specialists with extensive experience of the Accounts Rules and the way firms’ financial controls are examined in practice.

The course is aimed at COFAs, finance directors, legal cashiers, managing partners and anyone with responsibility for client account governance. It will cover the role of the COFA, reconciliations, breaches, residual balances, banking facilities, accountants’ reports, supervision of the finance function and how to deal with problems before they become regulatory events.

The fee is £495 plus VAT.

To reserve a place, email sam@jblcompliance.com.

View the course flyer

Disciplinary watch

AML records: “we considered it” is not enough

Four recent decisions return to a familiar point: a risk-based approach still needs a record.

Mulcahy Smith Ltd was fined £2,137 after an AML desk review found non-compliant policies, controls and procedures and no adequate record of client and matter risk assessment on four of six files. Smith & Graham was fined £6,380 for failing, over more than eight years, to maintain records of the risk assessments it said it had carried out.

Swinburne Maddison LLP was fined £20,920 after all ten reviewed files lacked a complete record of client and matter risk assessment. Brar & Co Ltd was fined £6,750 for failings in its firm-wide risk assessment, policies and controls, and insufficient risk assessment on all six files reviewed.

Rule 3.3: Client account is not a convenient payment service

Jay Allan Tooker, a former partner and co-head of a yacht practice, was fined £24,862 after authorising 22 payments for items including crew salaries, management, storage and insurance. The payments were not part of a regulated legal service and breached rule 3.3.

Paul Harfitt was rebuked after using client account over many years to receive and transfer monthly rental income for two clients where no regulated legal service was being provided. There was no finding of dishonesty or client loss, but client convenience and a longstanding arrangement is not an exception to the rule.

For the COFA, the useful question is whether you would be able to spot Rule 3.3 breaches as part of your usual systems and controls.

Two further decisions show how ordinary Accounts Rules housekeeping can grow into regulatory action. Hawkins Ryan LLP was fined £12,366 after moving estate money from client to office account when it was no longer instructed, without delivering a bill or written notification, retaining money unnecessarily and failing to account for interest. And Charsley Harrison LLP was fined £18,552 after failing to obtain and deliver qualified accountants’ reports for five consecutive years and allowing dormant client balances to accumulate.

A mistake can be repaired, but a false record cannot

Several decisions involve an initial problem followed by a dishonest attempt to disguise it.

Emma Smith became subject to a section 43 order after intentionally recording time for work that had not been done and initially giving a false account.

Charlotte Eaton received a section 43 order after providing an altered call-log screenshot when challenged about a mistaken call.

Luis Gonzalez received a section 43 order after forwarding emails that falsely suggested earlier messages had been sent.

Nishaat Shamas Saeed received a section 43 order after forging signatures and a language certificate, then fabricating material to conceal the position.

Ridita Rahman received the same type of order after using her employer’s letterhead and email account in a private landlord dispute, falsely describing herself as an associate and suggesting the firm acted for her.

People need to know that an error must be raised early and can be dealt with. Once somebody creates a false document, alters evidence or lies to cover the problem, you are immediately in strike-off territory.

Watch out for conflicts

Susan Mary Carpenter was rebuked after continuing to act for two executors when a dispute about an estate property created a conflict. A personal and derogatory letter to one executor compounded the issue.

Joint instructions should be monitored. The engagement terms should explain what happens if clients’ interests diverge, and the file should show that the conflict position was reconsidered when the facts changed.

Further cases from the SDT

Consultant struck off after taking client money personally

Richard Jefferies was struck off after undertaking criminal work outside an authorised practice, accepting payments into his personal bank account and in cash, and falsely telling the Court of Appeal and CPS that a regulated firm represented the client.

The case highlights the need for firms to maintain proper oversight of consultants, including the work they undertake, the clients they represent and whether any activity is taking place outside the firm’s systems.

Non-practising solicitor struck off over dishonest threats and stalking conviction

Adrian Berkeley was struck off after dishonestly using his professional status to threaten the family of a vulnerable woman. He falsely claimed to represent her, quoted fees of £500 per hour and suggested that her property would be transferred to him to meet legal costs. He had also been convicted of stalking another person.

The Tribunal found dishonesty, lack of integrity and an attempt to take unfair advantage.

Reprimand for inadequate advice on transfer of client’s home

Mark Feely was reprimanded after failing to record adequate instructions, client care arrangements and advice when a client transferred his home and only asset to his son.

The Tribunal rejected allegations that Feely had acted on the son’s instructions or demonstrated manifest incompetence. His admissions, cooperation and insight were taken into account.

Partner suspended for discriminatory comments and sexual misconduct

Ryan Sean Jack Williams was suspended for 12 months after making racist, antisemitic and sexualised comments and touching colleagues inappropriately at work-related events.

His seniority and responsibility for junior staff increased his culpability. Although alcohol and medical evidence were taken into account, they did not excuse the conduct.

The case reinforces that professional standards apply at workplace social events and that firms need trusted reporting routes and prompt, effective investigation procedures.

What we do

• Outsourced COLP and COFA support
• Learning management system for multiple users
• Bespoke training – remote and in person
• Compliance audits
• New firm and ABS applications
• Independent AML audits
• AML and sanctions support
• SRA Accounts Rules and client money reviews
• File reviews
• SRA reports and notifications
• Escrow accounts for law firms

Contact us if you need help with any of the issues in this newsletter.

Are the SRA’s COLP and COFA proposals aimed at the right problem?

The SRA’s proposed client money reforms go way beyond accountants’ reports. The more difficult proposal would restrict who can act as COLP or COFA in certain firms, based on who can determine or direct significant management decisions in practice.

Our webinar discussion raised an uncomfortable possibility: a rule intended to improve checks and balances could leave some firms appointing compliance officers with less authority, less access to information and less ability to challenge management. The article sets out the proposals and the governance questions firms should start asking now.

Read the webinar write-up

The supervision trap: maintaining SRA accountability with GenAI

AI-assisted work can arrive on a supervisor’s desk looking fluent, polished and complete. That appearance may conceal the most important questions: which tool was used, what information was entered, which sources were checked and what the junior actually understood.

This article explains why a final read-through is not enough. Firms need clear rules on approved tools, permitted uses, confidentiality, source verification and the level of supervision required. Juniors need a safe route to use the technology, not an expectation that they will design the controls themselves.

Thanks to Akrivium for this guest post.

Read the article

The SRA turns its attention to the money behind litigation funding

The SRA has opened a consultation on third-party litigation funding in consumer claims. It is not proposing a ban. The focus is on transparency, independence, financial resilience, risk assessment and what happens to clients if a funded practice fails.

For firms using external funding, this is becoming a governance issue rather than a matter left to the finance team or one commercial partner. Our article explains the proposed requirements and what firms should be reviewing before the consultation closes.

Read the article

A week in the life of a Senior Risk Specialist at JBL Compliance

What does compliance consultancy look like away from the policies and checklists? Ed Marshall gives a behind-the-scenes view of a varied week: helping firms respond to regulatory problems, reviewing evidence, talking through practical decisions and translating broad rules into steps that work in a real business.

Good compliance support is rarely about quoting a rule and walking away. Context, judgement and an understanding of how the firm operates are just as important.

We are looking for more people like Ed. Do you know someone who might be interested?

Read the article