SRA Fines a Law Firm £14,000 for Breaching ID Verification Regulation

  • Richard Marley
  • December 07, 2020
  • 2 minutes read
  • 357

A business organization is being penalized £14,000 by the Solicitors Regulation Authority (SRA) for not complying with the identity check regulations on conveyancing transactions.  

Seatons Law, a law firm in Northamptonshire has agreed that they have breached the money laundering regulations and have failed to run the business properly.

In the regulatory agreement, according to SRA, the law firm was asked to act for a seller in regards to Property A in 2018. No attorney or donor was found that provided instruction or photographic ID. However, they still told the other side that they had the ID that was required. 

After the payment of the remaining costs, £45,500 was deposited into the bank account to the attorney’s name. Due to the absence of further information, the Land Registry did not register the sale and the title is in the name of the donor. The SRA said that the law firm has, “with the assistance of its professional indemnity insurers, taken steps to rectify the position, which it anticipates will be possible”.

Under the same power of attorney, a second transaction was made. A third party that was claiming to be acting for the attorney had transferred property B as a gift into the attorney’s name. Again, there was a lack of ID and no proof of meeting with the attorney or the donor. There was no proof that the attorney has allowed the third party to act on their behalf. The Land registry stated to the firm, “noting that the transfer was not for value, was in favour of the attorney and asking it to clarify how and why the attorney was able to benefit and to also lodge evidence that the donor had ratified the transaction”.

The regulator has said that the firm has ignored the red flags like the involvement of the unverified third party and transfer of property for no consideration. The law firm has agreed to their neglecting customer verification and has agreed to strengthen its money laundering regulation.