The Solicitors Regulation Authority (SRA) is continuing to tighten its focus on sanctions compliance across the legal sector — and it recently announced the next steps firms should expect.
On 11 November, following a review of the sanctions data gathered through its AML & Sanctions Questionnaire earlier in the year, the SRA confirmed that it will be taking several targeted actions in the months ahead. If you’re a law firm wondering what this means for you, here’s a quick breakdown.
1.Tailored Guidance Letters to 490 Firms
Nearly 500 firms are set to receive personalised guidance from the SRA. These letters will go to practices whose questionnaire responses suggested their sanctions controls may need strengthening.
If your firm does not yet have:
- a written sanctions risk assessment, and/or
- a process for screening new clients against sanctions lists
…you may be on the receiving end of one of these letters. If it arrives, take the guidance seriously and act promptly.
2. More Desk-Based Reviews for Higher-Risk Firms
The SRA will be carrying out additional remote reviews of firms that:
- work with clients connected to sanctioned countries, or
- provide services considered higher risk from a sanctions perspective
Importantly, this applies to all firms, not just those within the scope of the Money Laundering Regulations. Keep an eye on SRA communications — and yes, that includes your junk folder — just in case you’re selected for review.
3. Sanctions Compliance Will Remain Part of AML Inspections
The SRA has confirmed that sanctions controls will continue to be examined as part of its regular AML inspections. This isn’t a temporary area of interest; it’s now very much built into the regulatory landscape
What Should Firms Be Doing Now?
If your sanctions compliance framework isn’t quite where it should be, now is the time to act. At a minimum, firms should have:
- A written sanctions risk assessment
- A clear internal policy explaining how staff should screen clients
- Documented procedures outlining what to do if a sanction match occurs
- Up-to-date templates, records, and training materials
If these documents are missing, outdated, or sitting on the “to-do” list, it’s worth getting them in order before the SRA comes knocking.
Our own template documents have recently been refreshed and can act as a solid starting point for firms looking to strengthen their compliance framework. These can be purchased from our shop. If you need support or want help tailoring them to your practice, feel free to get in touch.