Solicitors Regulation AuthorityWomble Bond Rebuked by Regulator For Breaching Accounts Rules
The UK's Solicitors Regulation Authority found that the firm had breached the rules by providing a client with a banking facility.
August 04, 2020 at 04:17 AM
3 minute read
The Solicitors Regulation Authority (SRA) has issued transatlantic law firm Womble Bond Dickinson with a rebuke, after an investigation found it had provided a banking facility to one of its clients, in breach of the regulator's accounting rules.
The U.K. regulator found that Womble had held funds relating to a commercial scheme on behalf of one of its corporate clients, according to a notice published by the SRA.
The firm had allowed payments to be made from the funds totalling over half a million pounds and over €2.2 million, outside of the remit of its instructions and in breach of the SRA Accounts Rules 2011.
The events took place between March 2013 and March 2018, according to the SRA.
In an agreed regulatory outcome, WBD acknowledged that the situation arose due to the actions of an individual former partner who set up bank accounts outside the law firm's central finance function.
The firm also agreed to pay a contribution to the costs of the investigation, including the SRA's legal costs, in the sum of £3,840.
In a statement, Jonathan Blair, WBD managing partner, commented: "Having self-reported this breach to the SRA we have cooperated fully and accept their lowest level of sanction, a rebuke. Processes are now in place to ensure this issue cannot re-occur"
As recently as 2018, the SRA has restated its warning to law firms not to use client accounts as banking facilities.The rules state that firms should only have money linked to an underlying legal service going through their client account.
According to the SRA, the risks of offering banking facilities to clients include assisting money laundering, helping someone avoid their obligations in an insolvency situation, or improperly hiding assets in a commercial or matrimonial dispute.
In March, fellow U.K. top 50 firm Withers was rebuked by the SRA for failing to adequately provide anti-money laundering training to relevant employees.
The rebuke followed a warning in October by the regulator that it was going to crack down on money-laundering non-compliance after it found that a fifth of firms were not adhering to its regulations.
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