Navigating the SRA’s Intensified AML Enforcement: How Hoowla Supports Law Firms in Compliance

The Solicitors Regulation Authority (SRA) has recently intensified its focus on anti-money laundering (AML) compliance, issuing substantial fines to law firms for breaches.

In the past six months alone, the SRA has levied 50 fines totalling £575,000, signalling a robust enforcement approach aimed at ensuring firms adhere to AML regulations.

This heightened scrutiny underscores the necessity for law firms to implement effective AML compliance measures. Legal technology platforms, such as Hoowla, offer tools designed to assist firms in meeting these regulatory requirements efficiently.

Understanding the SRA’s Enhanced AML Enforcement

The SRA’s recent actions reflect a commitment to strengthening the legal profession’s defences against money laundering activities. The regulator has expressed concern over persistent deficiencies in firms’ AML arrangements, including the absence of firm-wide risk assessments and inadequate client due diligence procedures.

To address these issues, the SRA plans to increase the consequences for non-compliance. This includes conducting 700 AML inspections, both desk-based and onsite, by October 2025. As of the first four months of the year, 297 inspections have already been completed, exceeding the initial target.

Key Areas of AML Compliance Focus

The SRA’s enforcement efforts concentrate on several critical areas:

1. Firm-Wide Risk Assessments: Firms are required to conduct comprehensive assessments to identify and mitigate potential AML risks across all operations.

2. Policies, Controls, and Procedures: Establishing robust internal policies and procedures is essential to manage and mitigate money laundering risks effectively.

3. Client and Matter Risk Assessments: Each client and matter must be evaluated individually to determine the level of AML risk and apply appropriate due diligence measures.

4. Ongoing Monitoring and Record-Keeping: Firms must continuously monitor client relationships and maintain accurate records to detect and prevent suspicious activities.

The Role of Legal Technology in AML Compliance

Implementing legal technology solutions can significantly enhance a firm’s ability to comply with AML regulations. Platforms like Hoowla provide tools that assist in compliance processes, reduce administrative burdens, and improve accuracy in risk assessments and record-keeping.

How Hoowla Supports AML Compliance

Hoowla offers a suite of features designed to assist law firms in meeting AML obligations:

• Integrated AML Checks: Hoowla’s platform includes built-in AML checks that allow firms to verify client identities and assess risks efficiently.

• Automated Risk Assessments: The system facilitates the creation of firm-wide and matter-specific risk assessments, ensuring consistent evaluation across all cases.

• Audit Trails: Hoowla maintains comprehensive audit trails, documenting all compliance-related activities and decisions, which is crucial during SRA inspections.

• Secure Document Management: The platform provides secure storage for all AML-related documents, ensuring easy access and retrieval when needed.

• Regular Updates and Support: Hoowla offers ongoing support and updates to keep firms informed about changes in AML regulations and best practices.

We integrate with third parties to assist in the AML checking process: Confirmly and Armalytix

For more detailed information on how Hoowla can assist with AML compliance, firms can refer to the Hoowla Help Centre.

The SRA’s intensified enforcement of AML regulations highlights the critical importance of robust compliance measures within law firms. By using legal technology solutions like Hoowla, firms can enhance their compliance processes, reduce the risk of regulatory breaches, and maintain the integrity of their operations.

Staying proactive in implementing effective AML strategies is not only a regulatory requirement but also a fundamental aspect of responsible legal practice.

Note: This article is intended for informational purposes and does not constitute legal advice. Firms should consult with compliance professionals to address specific regulatory requirements.