Cooklaw Solicitors Ltd
2A-2B Colima Avenue, Enterprise Park, Sunderland , SR5 3XB
Recognised body
8001066

Decision - Agreement

Outcome: Regulatory settlement agreement

Outcome date: 1 July 2025

Published date: 3 July 2025

Firm details

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

Name: Cooklaw Solicitors Ltd

Address(es): 2A-2B Colima Avenue, Enterprise Park, Sunderland, SR5 3XB

Firm ID: 8001066

Outcome details

This outcome was reached by agreement.

Decision details

1. Agreed outcome

1.1 Cooklaw Solicitors Ltd (the Firm), a recognised body authorised and regulated by the Solicitors Regulation Authority (SRA), agrees to the following outcome to the investigation:

1. Cooklaw Solicitors Ltd will pay a financial penalty in the sum of £25,000 under Rule 3.1(b) of the SRA Regulatory and Disciplinary Procedure Rules,
2. to the publication of this agreement under Rule 9.2 of the SRA Regulatory and Disciplinary Procedure Rules, and
3. Cooklaw Solicitors Ltd will pay the costs of the investigation of £600, under Rule 10.1 and Schedule 1 of the SRA Regulatory and Disciplinary Procedures Rules.

2. Summary of Facts

2.1 We carried out an investigation into the firm following an inspection by our AML Proactive Supervision Team.

2.2 Our inspection and subsequent investigation identified areas of concern in relation to the firm's compliance with the Money Laundering, Terrorist Financing (Information on the Payer) Regulations 2017 (MLRs 2017), the SRA Principles 2019 and the SRA Code of Conduct for Firms 2019.

Firm-wide risk assessment (FWRA)

2.3 Between 10 November 2020 and 18 November 2024, the firm failed to have in place an appropriate assessment of the risks of money laundering and terrorist financing to which its business was subject (a firm-wide risk assessment (FWRA)), pursuant to Regulation 18(1) and 18(4) of the MLRs 2017.

Policies, controls and procedures (PCPs)

2.4 Between 10 November 2020 and 18 November 2024, the firm failed to regularly review and update its policies, controls, and procedures (PCPs) to mitigate and manage effectively the risks of money laundering and terrorist financing, identified in any risk assessment (FWRA), pursuant to Regulation 19(1)(b) of the MLRs 2017.

Customer due diligence (CDD) measures and Enhanced customer due diligence (EDD) measures

2.5 In one file, the firm failed to conduct:

1. appropriate customer due diligence measures, including the identification and verification (ID&V) of the client, pursuant to Regulation 28(2) of the MLRs 2017.
2. appropriate customer due diligence measures, and ongoing monitoring (including, where necessary, the source of funds), pursuant to Regulation 28(11) of the MLRs 2017.
3. client and matter risk assessments (CMRAs), pursuant to Regulation 28(12)(a)(ii) and Regulation 28(13) of the MLRs 2017.
4. appropriate enhanced customer due diligence measures, including where necessary, source of wealth, pursuant to Regulations 33(1)(b) and 33(3A)(c) of the MLRs 2017.

2.6 The firm has since confirmed it has put in place measures to ensure continuing and future compliance, including updating and amending its FWRA and PCPs, registering as a trust and company service provider (TCSP), revised its client and matter risk assessment (CMRA) and trained staff on the importance and completion of CMRAs and to ensure, where necessary, EDD checks were undertaken on all live, in-scope files.

3. Admissions

3.1 The firm admits, and the SRA accepts, that by failing to comply with the MLRs 2017, it has breached or failed to achieve:

1. Principle 2 of the SRA Principles 2019 – which states you act in a way that upholds public trust and confidence in the solicitors' profession and in legal services provided by authorised persons.
2. Paragraph 2.1(a) of the SRA Code of Conduct for Firms 2019 – which states 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.
3. Paragraph 2.2 of the SRA Code of Conduct for Firms 2019 – which states you keep and maintain records to demonstrate compliance with your obligations under the SRA's regulatory arrangements.
4. Paragraph 3.1 of the SRA Code of Conduct for Firms 2019 – which states that you keep up to date with and follow the law and regulation governing the way you work.

4. Why a fine is an appropriate outcome

4.1 The SRA's Enforcement Strategy sets out its approach to the use of its enforcement powers where there has been a failure to meet its standards or requirements.

4.2 When considering the appropriate sanctions and controls in this matter, the SRA has taken into account the admissions made by the firm and the following mitigation:

1. The firm took steps to put in place a compliant FWRA, PCPs, and CMRA, registered as a TCSP, rolled out training to staff and reviewed and revised its files.
2. The firm has cooperated with the SRA's AML Proactive and AML Investigation teams.

4.3 The SRA considers that a fine is the appropriate outcome because:

1. The conduct showed a disregard towards statutory and regulatory obligations and had the potential to cause harm, by failing to ensure the firm had proper AML control documentation in place and failing to undertake CMRAs, conduct ID&V checks, source of funds (SoF), EDD and source of wealth (SoW) checks in conveyancing transactions, that could have led to money laundering (and/or terrorist financing).
2. It was incumbent on the firm to meet the requirements set out in the MLRs 2017. The firm failed to do so. The public would expect a firm of solicitors to comply with its legal and regulatory obligations, to protect against these risks as a bare minimum.
3. The agreed outcome is a proportionate outcome in the public interest because it creates a credible deterrent to others and the issuing of such a sanction signifies the risk to the public, and the legal sector, that arises when solicitors do not comply with anti-money laundering legislation and their professional regulatory rules.

4.4 Rule 4.1 of the Regulatory and Disciplinary Procedure Rules states that a financial penalty may be appropriate to maintain professional standards and uphold public confidence in the solicitors' profession and in legal services provided by authorised persons. There is nothing within this Agreement which conflicts with Rule 4.1 of the Regulatory and Disciplinary Rules and on that basis, a financial penalty is appropriate.

5. Amount of the fine

5.1 The amount of the fine has been calculated in line with the SRA's published guidance on its approach to setting an appropriate financial penalty (the Guidance).

5.2 Having regard to the Guidance, the SRA and the firm agree that the nature of the misconduct was more serious (score of three). This is because the firm's failure to ensure it had proper documentation in place shows a persistent disregard of the firm's regulatory obligations. This is more serious given the lack of CMRAs, CDD, SoF, EDD and SoW at file level, which translated to a poor understanding of the risks posed by clients and matters and resulted in insufficient scrutiny being applied.

5.3 The firm only became compliant with the MLRs 2017 because of our AML deskbased review and guidance we have provided. The breach has arisen because of recklessness and a failure to pay sufficient regard to money laundering regulations, published guidance and SRA warning notices. The firm has failed to ensure that it was fully compliant with its statutory obligations until November 2024, a period of over seven years since the MLRs 2017 came into effect.

5.4 The impact of the harm or risk of harm is assessed as being medium (score of four). The nature of conveyancing is considered high-risk, owing to the risk of abuse of the system by criminals. We note the firm currently undertakes nearly all of its work in-scope of the money laundering regulations, via mainly conveyancing. This puts it at a risk of being used to launder money. Conveyancing is a high-risk area for money laundering and terrorist financing, however there is no evidence of there being any direct loss to clients as a result of the firm's failure to ensure it had proper documentation in place and despite not conducting necessary checks at file level with respect to ID&V, CMRAs, CDD/EDD and SoF/SoW.

5.5 The 'nature' of the conduct and the 'impact of harm or risk of harm' added together give a score of seven. This places the penalty in Band 'C', as directed by the Guidance.

5.6 We and the firm agree a financial penalty at the highest end of the bracket. This is because the lack of a compliant AML control environment for four years coupled with the various and continued breaches identified at file level is serious and cannot be considered anything less than the higher end of the bracket.

5.7 However, despite the lack of compliance until late 2024, we are pleased to see the firm has confirmed it has put in place measures to ensure continuing and future compliance, by updating and amending its FWRA and PCPs, registering as a TCSP, revising its CMRA and rolling out training to staff on the importance and completion of CMRAs and to ensure, where necessary, EDD checks were undertaken on all live, in-scope files.

5.8 Based on the evidence the firm has provided of its annual domestic turnover, this results in a basic penalty of £28,486.

5.9 The SRA considers that the basic penalty should be reduced to £25,000. This reduction reflects the mitigation set out at paragraph 4.2 above.

5.10 The firm does not appear to have made any financial gain or received any other benefit as a result of its conduct. Therefore, no adjustment is necessary, and the financial penalty is £25,000.

6. Publication

6.1 Rule 9.2 of the SRA Regulatory and Disciplinary Procedure Rules states that any decision under Rule 3.1 or 3.2, including a Financial Penalty, shall be published unless the particular circumstances outweigh the public interest in publication.

6.2 The SRA considers it appropriate that this agreement is published as there are no circumstances that outweigh the public interest in publication, and it is in the interest of transparency in the regulatory and disciplinary process.

7. Acting in a way which is inconsistent with this agreement

7.1 The firm agrees that it will not deny the admissions made in this agreement or act in any way which is inconsistent with it.

7.2 If the firm denies the admissions, or acts in a way which is inconsistent with this agreement, the conduct which is subject to this agreement may be considered further by the SRA. That may result in a disciplinary outcome or a referral to the Solicitors Disciplinary Tribunal on the original facts and allegations.

7.3 Acting in a way which is inconsistent with this agreement may also constitute a separate breach of Principles 1, 2 and 5 of the SRA Principles and paragraph 3.2 of the Code of Conduct for Firms.

8. Costs

8.1 The firm agrees to pay the costs of the SRA's investigation in the sum of £600. Such costs are due within 28 days of a statement of costs due being issued by the SRA.