Regulatory oversight: Lessons from Beighton Singh Limited's AML compliance failure

Beighton Singh Limited, a recognised body in Derby, recently found itself in the regulatory spotlight due to serious lapses in its anti-money laundering (AML) practices. Following a thorough investigation by the Solicitors Regulation Authority (SRA), the firm was fined £19,482 and ordered to pay additional costs of £1,350 for failing to adhere to the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLRs 2017).

The misconduct spanned a significant period from June 2017 to November 2023, during which the firm failed to maintain compliant firm-wide risk assessments (FWRA) and policies, controls, and procedures (PCPs) as required by the regulations. Despite repeated guidance and warnings from the SRA, Beighton Singh Limited did not rectify the deficiencies until November 2023.

The severity of the firm's conduct is underscored by its breach of regulatory obligations, posing risks to the public interest and eroding confidence in the legal profession. Particularly alarming is the high proportion of the firm's work falling under the scope of MLRs 2017, amplifying the potential harm caused by its non-compliance.

The SRA's decision to impose a significant financial penalty reflects the gravity of the situation. Beighton Singh Limited's conduct was classified within conduct band C, warranting a penalty ranging from 1.6% to 3.2% of annual domestic turnover. Mitigating factors, including the firm's cooperation with the investigation and remedial actions taken, were considered in determining the final penalty.

This case serves as a cautionary tale for legal firms, emphasising the critical importance of robust AML measures and regulatory compliance. The principles outlined in the SRA Code of Conduct must be upheld to maintain public trust and confidence in legal services. Effective governance structures, ongoing training, and strict adherence to legislative requirements are essential to mitigate risks and safeguard against financial crimes.

In the wake of this enforcement action, legal practitioners are urged to review their AML frameworks, ensuring they meet regulatory standards and proactively address any shortcomings. By prioritising compliance and adopting a proactive approach to risk management, firms can uphold their professional responsibilities and contribute to a more resilient and trustworthy legal sector.