The Solicitors Regulation Authority (SRA) has conducted a thematic review of how firms and individuals engage with their professional obligations.
This review highlights how firms access, understand, and integrate regulatory information, as well as areas for improvement to promote a culture of compliance and competence.
The review engaged with 250 individuals through a survey, conducted in-depth interviews at 20 firms, and examined the training records of 20 fee earners. It assessed their understanding of key regulatory areas:
- Reporting obligations
- Continuing competence
- The SRA Transparency Rules
- Cybercrime
- Anti-money laundering
While most respondents expressed confidence in their knowledge, interviews revealed gaps between perceived and actual understanding. Many solicitors overestimated their regulatory knowledge, highlighting the need for a proactive approach to education and resource engagement.
The review found that while firms distinguished between legal, ethical, and regulatory training, fee earners often did not record their regulatory training. Informal methods of disseminating regulatory information, such as emails and discussions, were prevalent but rarely documented. This reliance on ad-hoc methods limited firms’ ability to monitor and support competence systematically.
What’s more, there was a noticeable emphasis on legal training over regulatory or ethical dimensions, suggesting a need for more balanced training approaches.
- Cybercrime and anti-money laundering were identified as critical areas with varying levels of understanding:
- Cybercrime: Most firms recognised its significant risk, but three firms lacked policies or training despite prior cyberattacks.
- Anti-money laundering: Confusion persisted, with some COLPs and fee earners unsure of their regulatory scope or the identity of their Money Laundering Reporting Officer.
Firms generally recognised the importance of fostering supportive cultures and rewarding positive behaviours. Many had formal systems acknowledging team performance and cultural contributions alongside financial results. Firms with defined core values embedded them into their reward structures, a practice fee earners welcomed.
However, reliance on informal approaches and inadequate record-keeping hindered firms’ ability to ensure consistent compliance with professional obligations.
The review identified key aspirations among firms and individuals:
- COLPs prioritised improving processes and controls, diversifying responsibilities, and reducing reliance on compliance officers.
- Fee earners expressed a desire for more guidance, updates, and better communication from their firms.
To enhance compliance, the SRA have said that firms and individuals must:
- Leverage SRA Resources: Proactively review and utilise the SRA’s guidance, tools, and updates to stay informed about regulatory expectations.
- Prioritise Balanced Training: Recognise the value of regulatory and ethical training alongside legal skills, ensuring all are well-documented.
- Strengthen Systems and Controls: Shift from ad-hoc information sharing to structured approaches that promote accountability and consistent compliance.
Feedback from firms included calls for better promotion of existing resources, compulsory training, improved website usability, and tailored support for small firms.
