This newsletter is brought to you by the team of SRA compliance consultants at Jonathon Bray ✅
Failure to disclose – new CPS guidance is a serious risk for lawyers
Solicitors and law firms need be aware of recent CPS prosecution guidance update. It has potentially extended the reach of the ‘failure to disclose’ money laundering offence.
The importance of WIP valuation
WIP valuation is often critically wide of the mark, says Rupert Hawke.
As a law firm what’s the biggest number on your balance sheet? It is likely to be your Work-In-Progress (WIP).
And here’s the scary thing – it is likely to be the most inaccurate number in your accounts!
A lack of annual audit of WIP can lead to yearly ‘drift’. That can result in a balance sheet figure that varies dramatically from the real WIP value.
If WIP is incorrectly valued it can also distort the results of fee-earners, depending on the performance measurement system used. And in turn the firms monthly profitability reporting will be inaccurate.
News and Guidance
Law Society Updates
- NEW: Conveyancing fraud flyer – consider sending this to all conveyancing clients.
- Updated practice note: Conflict of interests
- Q&A: Can a club refer a complaint to the Legal Ombudsman? (spoiler alert: yes, if it has income under £1m)
- Consultation response: HM Treasury review of the Money Laundering Regulations 2017
SRA Updates
- Confirmed: the deadline for completing applications for individual practising certificate renewals, bulk renewals and firm periodic fees is extended to 1pm on 11 November (not the 8th, as it says on their recorded message).
- Updated guidance: Preparing to become a sole practitioner or an SRA-regulated freelance solicitor
- Business Plan sets out work for year ahead
Other Updates
- Unite the Union fined £45,000 by the ICO for making 57,000 unsolicited calls to people on the TPS register.
Webinars
A huge thank you to Tom Lethaby, Gerry Young (both of RVE Corporate Finance) and Chris Fallon (of Tapestry Compliance, an award-winning boutique law firm). They joined Rachael Eyre to talk about the Employee Ownership Trusts (EOTs) and their role in law firm succession planning.
It was a fascinating discussion, with some of the main points picked up in our write-up.
Access the recording (Passcode v=Y*yNH0). The recording will be available for a few more days.
Disciplinary decisions
- Madiya Ahmed Arshad – inexperienced solicitor rebuked after the firm she was left to manage was targeted by conveyancing fraudsters, resulting in client shortfalls of £400,000.
- Matthew John Elash – fined £1,100 after conviction for drink driving.
- Montague Frankel – struck off after using the client account as a banking facility for twenty years, and attempting to deceive SRA investigators.
- Fincap Law LLP – firm fined £800 for filing a late SRA declaration that it had compliant AML procedures in place.
- Evans, Hayes, Burnell Solicitors Limited – firm fined £375 for filing a late SRA declaration that it had a compliant firm-wide risk assessment in place.
