Should I report a minor AML breach to the SRA?

I’m a money laundering officer. On a file review, I found we did not carry out customer due diligence on the beneficial owner of a company for a straightforward conveyancing matter with no AML concerns. Should I report this to the SRA?

The Solicitors Regulation Authority (SRA) requires you to report any serious breaches.

You should review your past file reviews/audits in order to see if there are any similar breaches which lead to a pattern.

If you conclude this is a one-off breach limited in scope and impact, you do not need to report. However, you should record it for compliance purposes.

The SRA’s anti-money laundering (AML) guidance – reporting breaches states:

“The principles of what could constitute serious breaches of the Money Laundering Regulations are as follows (this is not an exhaustive list):

• intentional or reckless breaches of legal requirements in relation to applicable anti-money laundering legislation or regulation
• systemic regulatory breaches associated with a failure of AML-related policies, controls or procedures
• the facilitation of business activities which bear the hallmarks of money-laundering activity (this does not replace the legal requirement to file a SAR where appropriate)

You do not need to report one-off breaches of the regulations which are limited in scope and impact.”

For further information, see the SRA’s guidance on reporting AML breaches.