Law Firms - SRA Regulatory

The dramatic increase in the regulatory burdens placed on law firms has led to an upturn in their need to access external advice on their regulatory obligations and how best to respond when things go wrong.

Law firms no longer seek legal advice solely for the purpose of defending proceedings before the Solicitors Disciplinary Tribunal (SDT); firms now require advice on when to report a matter to the SRA, how to comply with the SRA Standards and Regulations, their business structure options, running an internal investigation and how to respond to SRA requests for information and how to handle an SRA investigation.

SRA Regulatory Specialists

We advise law firms on all matters touching upon their regulatory obligations and regulated status. We have unrivalled knowledge and expertise in the detailed and nuanced regulatory framework within which law firms in England and Wales operate. Our experience in also acting for the majority of legal services regulators in England and Wales and our truly expert team, means that we occupy a unique place in this market.

This is led by a 3 partner team who work exclusively in this area:  Iain Miller, Julie Norris and Jessica Clay.  The team advises leading UK and Global Law Firms on SRA regulatory issues and provides market leading expertise on highly confidential and sensitive issues that are critical to law firm reputations.

How we can help
 

GENERAL ADVICE ON REGULATORY AND ETHICAL ISSUES

It is sometimes the case that firms will need to make difficult choices in respect of their duties to their clients, the courts, and the wider public interest.  There may be no right answer.  We can offer independent authoritative advice addressing a range of issues you might be facing.  An example is whether a matter needs to be reported to the SRA and the drafting of any associated notification.  It is not always clear as to whether a matter needs to be reported to the SRA and if it does how this should be done.  We can provide advice and support to guide you through the process. Other issues we can assist you with include advising in respect of conflicts of interest; character and suitability requirements, issues relating to confidentiality and ethical decision making and its links to law firm risk management, particularly in respect of promoting law firm culture and wellbeing.

CONDUCTING INDEPENDENT INTERNAL INVESTIGATIONS

In even the best run law firms, things can still go wrong. Responding promptly and effectively to these issues can minimise reputational and regulatory risks. Through the setting up and running of an investigation, we can help you by getting to the heart of what went wrong, advising you on how to put it right and making recommendations so that lessons can be learnt and the same or similar issues do not arise in the future.  We can then prepare an investigation report which you can provide to the regulator if needed and we can also advise on your reporting obligations in respect of this.

ADVICE ON REGULATORY STRUCTURES AND AUTHORISATION AND PRACTICE REQUIREMENTS

We advise firms on effective business structures for those that are seeking to establish in England and Wales for the first time or are considering changing their practice structure, perhaps to an alternative business structure (ABS) or to sit outside of SRA regulation.  This includes strategic advice on how best to structure the business through to any applications for authorisation. Within this area of work, we advise both established firms and start-ups and our expertise in relation to the complex and nuanced underpinning legal services framework enables us to come up with the best solution for you – there is no “one size fits all” approach.   We can also undertake regulatory due diligence for those seeking to acquire or invest in a law firm.  Just like any other business, those investing in a regulated legal services provider will need advice on the regulatory issues and any risks such an investment may present.

We have set up a consultancy that specialises in these matters, our Strategic Regulatory Advisory Team. This team comprises a select group of individuals with deep domain expertise and the practical experience of having dealt with these issues many times.

ANTI-MONEY LAUNDERING (AML) COMPLIANCE and audit 

We advise and represent firms in respect of all matters relating to their anti-money laundering (AML) obligations under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017, and preceding AML legislation. The SRA requires firms that are in scope of these regulations to have in place robust AML regimes underpinned by a firm-wide risk assessment and effective policies, controls and procedures. Firms must also carry out appropriate due diligence on clients and matters, deliver appropriate and regular training to their lawyers, and undertake audits to check they are complying with their AML obligations. We work closely with our colleagues in Criminal Litigation to offer a comprehensive service to law firms, ranging from strategic advice in respect of their obligations to acting on their behalf in investigations concerning alleged AML breaches.

Start-ups and alternative new legal businesses (whether SRA regulated or not) come to us for advice on whether the work they are proposing to do is in scope of the regulations. These decisions have a material impact on measures that need to be in place from launch. Where required, we work promptly to review or prepare PCPs, assist with training and other related operational and governance issues.

We offer firms AML audits to help you spot problems before the SRA does. Not only do AML audits meet the requirement for a regular independent audit in the money laundering regulations, it will mean that you are best placed to receive a good outcome from a future regulatory inspection or desk-based review. Our audit approach is based on decades of experience and sector knowledge, plus enhanced file reviews gives you a complete picture of your AML controls. Along with assessing whether you are complying with the regulations, we will also offer best practice guidance, benchmarking and support in implementing any recommendations.

Fraud audit 

Our Regulatory and Criminal law teams can help law firms manage their risk arising from the new 'failure to prevent fraud' corporate criminal offence created by the Economic Crime and Corporate Transparency Act 2023 (ECCTA).

Under this legislation, from September 2025 a large organisation is criminally liable if:

• A specified fraud offence is committed by an employee, agent, or other 'associated person' for the organisation's benefit.
• The organisation did not have 'reasonable' fraud prevention procedures in place.

We will comprehensively review the effectiveness of your procedures and policies to prevent fraud, including your risk assessment and control framework. Our final report will contain an assessment of your compliance with government guidance, and tailored advice on any actions that should be taken.

Sanctions Audit

The financial sanctions regime is complex and constantly changing. Supervisors are becoming more proactive about checking firms’ controls to prevent sanctions breaches and whether they have abided by the terms of any licences they have relied upon.

We will review your sanctions systems, risk assessments and client due diligence. We will provide clear, bespoke guidance on whether your policies and controls meet legislative requirements and regulatory guidance. We will provide a tailored plan to help you manage your financial sanctions risk based on the regulations, your risk profile and relevant industry guidance.

Culture Reviews

At the heart of every successful business lies a positive and supportive workplace culture. Firms that value and promote wellbeing and a speak up culture are more likely to retain top talent, deliver exceptional services to clients, and maintain workplace culture which is sustainable and founded upon good ethical practice.

This is not just a question of good behaviour. For regulated professional services firms in particular, there are clear ethical and professional standards which must be met.

If you have concerns about your firm’s workplace culture, or would like to know how to meet your statutory and regulatory obligations, then we can conduct an independent and balanced review of your organisational or team culture. Our sector specific expertise enables us to advise on what is, and is not, acceptable from a regulatory and an employment law perspective, and help put in place the measures needed to create and maintain a positive workplace culture.

SRA INVESTIGATIONS AND REPRESENTATION BEFORE THE SDT

Cases before the SDT are a small proportion of those that are subject to investigation by the SRA.  Each year the SRA receives around 12,000 reports and investigates about half of these.  However, you may need to take advice on how to respond to an SRA investigation at an early stage and may require advice through to the final resolution of the matter.  

Those facing investigation by the SRA or defending themselves before an SDT panel understand how important the obtaining of insightful and timely legal advice can be. Every approach by the SRA has the potential to damage the reputation and prospects of those involved; all communication with the SRA during an investigation should therefore be the subject of careful thought and expert legal advice.  Furthermore, being the subject of an SRA investigation can be hugely stressful and brings with it an inherent risk to your firm’s reputation and perhaps your onward ability to operate.  We are in a unique position in the market in that we have extensive experience from both sides of such investigations and can help you to achieve the best possible outcome as we know what is likely to work and what won’t.

Our team is top ranked in the legal directories for the provision of advice in respect of SRA investigations and any subsequent Tribunal proceedings and this is underpinned by us having acted in some of the most serious, complex and high-profile solicitor disciplinary cases over the last 20 years.  Many of you may also require the assistance of specialist legal advisers in our employment and criminal teams; we provide that legal advice seamlessly, ensuring a coherent, consistent and efficient service. 

We are extremely well placed to advise you in any of the following areas:

• Advising in respect of any Forensic Investigation undertaken by the SRA;
• Providing advice and representation at any recorded interviews conducted by the SRA;
• Formally responding to allegations set out against you in the SRA’s rule 2.3 notice;
• Assisting with formal requests for disclosure;
• Advising and assisting with alternative disposals to a hearing, such as a Regulatory Settlement Agreement or an Agreed Outcome;
• Gathering evidence and preparing your case for any hearing;
• Presenting your case at the SDT; or
• Advising and assisting with any form of appeal that is needed.

You can read our SRA Investigations and SDT proceedings FAQs here.

AI advisory services

The regulatory framework concerning AI, and in particular, generative AI, is evolving at pace. We can advise firms who are unsure of how their use or proposed use of AI and generative AI complies with their regulatory obligations and the wider framework, and how it fits with their overall risk management strategy.

We can provide strategic, governance and risk management advice and input, to help firms assess and weigh up the opportunities that generative AI offers and balance this against any risks it might pose.