WHETHAM & GREEN

Decision - Fined

Outcome: Fine

Outcome date: 19 December 2024

Published date: 13 February 2025

Firm details

Firm or organisation at date of publication and at time of matters giving rise to outcome

Name: Whetham & Green

Address(es): 54 Crescent Road, Burgess Hill, RH15 8EG

Firm ID: 619525

Outcome details

This outcome was reached by SRA decision.

Decision details

Who does this disciplinary decision relate to?

Whetham & Green is a recognised body whose offices are at 54 Crescent Road, Burgess Hill, West Sussex RH15 8EQ.

Summary of decision

The firm was fined for failing to ensure it had relevant documentation in place to prevent activities relating to money laundering and terrorist financing as required by the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLRs 2017).

Facts of the misconduct

The SRA's Anti-Money Laundering (AML) Proactive Team undertook an inspection at the firm to assess its compliance against the MLRs 2017. On 12 July 2023, an SRA AML officer communicated the outcome of its desk based review. Concerns were raised surrounding the firm's compliance with requirements for a documented and compliant firm wide risk assessment (FWRA) and policies, controls and procedures (PCPs).

These concerns led to a referral to the SRA's AML investigation team. The firm was provided with guidance to help it come into compliance in July 2023. The firm took remedial action and revised its FWRA and PCPs shortly after this.

Findings

It was found that:

1. Between 26 June 2017 and 3 February 2020, the firm failed to have in place a documented assessment of the risks of money laundering and terrorist financing to which its business was subject (a FWRA) pursuant to Regulation 18(1) and 18(4) of the MLRs 2017.
2. Between 26 June 2017 and 30 January 2020, the firm failed to establish and maintain adequate PCPs to mitigate and effectively manage the risks of money laundering and terrorist financing, identified in any risk assessment (FWRA), pursuant to Regulation 19(1)(a) of the MLRs 2017, and regularly review and update them pursuant to Regulation 19(1)(b) of the MLRs 2017.
3. Between 30 January 2020 and 13 July 2023, the firm failed to establish and maintain fully compliant PCPs to mitigate and effectively manage the risks of money laundering and terrorist financing, identified in any risk assessment (FWRA), pursuant to Regulation 19(1)(a) of the MLRs 2017, and regularly review and update them pursuant to Regulation 19(1)(b) of the MLRs 2017.

In doing so, to the extent the conduct took place between 6 October 2011 and 24 November 2019, the firm:

• breached Principles 6 and 8 of the SRA Principles 2011,
• failed to achieve Outcomes 7.2 and 7.5 of the SRA Code of Conduct 2011
• and to the extent the conduct took place after 25 November 2019
• breached Principle 2 of the SRA Principles 2019, and
• breached Paragraphs 2.1(a) and 3.1 of the SRA Code of Conduct for Firms (2019).

Decision on sanction

The firm was directed to pay a financial penalty of £10,035 and ordered to pay costs of £1,350.

This was because the firm's conduct was serious by reference to the following factors in the SRA Enforcement Strategy:

1. The findings relate to breaches of the MLRs 2017, which protect the public from the serious consequences of money laundering and terrorist financing.
2. The firm's conduct was a breach of its regulatory obligations which persisted for longer than was reasonable. It demonstrated a pattern of non-compliance.
3. The firm was responsible for its own conduct which was serious and had the potential to cause harm to the public interest and to public confidence in the legal profession. This risk was heightened given the high proportion of the firm's work that was 'in scope' of the MLRs 2017.

In view of the above, the firm's conduct was placed in conduct band C which has a financial penalty of 1.6 per cent to 3.2 per cent of annual domestic turnover. The firm's conduct was placed towards the lower end of this band at C2 (2.0 per cent of annual domestic turnover).

The following mitigating factors were considered:

1. The firm co-operated fully with the SRA's investigation.
2. It quickly took remedial action once provided with SRA guidance.
3. There was no evidence that actual harm had materialised

SRA Standards and Regulations breached

SRA Principles 2011

Principle 6 - You must behave in a way that maintains the trust the public places in you and in the provision of legal services.

Principle 8 - You must run your business or carry out your role in the business effectively and in accordance with proper governance and sound financial and risk management principles.

SRA Principles 2019

Principle 2 - You act in a way that upholds public trust and confidence in the solicitors' profession and in legal services provided by authorised persons.

SRA Code of Conduct 2011

Outcome 7.2 - You have effective systems and controls in place to achieve and comply with all the Principles, rules and outcomes and other requirements of the Handbook where applicable.

Outcome 7.5 - You comply with legislation applicable to your business, including anti-money laundering and data protection legislation.

SRA Code of Conduct for Firms 2019

Paragraph 2.1(a) - You have effective governance structures, arrangements, systems and controls in place that ensure you comply with all the SRA's regulatory arrangements, as well as with other regulatory and legislative requirements, which apply to you.

Paragraph 3.1 - You keep up to date with and follow the law and regulation governing the way you work.