Session 1 An introduction to compliance

1 Contents The compliance maze OFR and SRA Handbook Cost of compliance COLP and COFA Compliance arrangements Compliance failures

2 The compliance maze Law firm specific (SRA Handbook)General regulatory requirements SRA PrinciplesMoney Laundering Regulations 2007, SI 2007/2157 Code of Conduct 2011Proceeds of Crime Act 2002 Practice Framework Rules 2011Data Protection Act 1998 Authorisation Rules 2011Bribery Act 2010 Recognised Bodies Regulations 2011Legal Services Act 2007 Solicitors Accounts Rules 2011Financial Services and Markets Act 2000 SRA Indemnity Rules 2011Consumer Protection (Distance Selling) Regulations 2000, SI 2000/2334 SRA Compensation Fund Rules 2011Provision of Services Regulations 2009, SI 2009/2999 SRA Disciplinary Procedure Rules 2011 Equality Act 2010

3 OFR and SRA Handbook 2011

4 The 10 Principles 1. uphold the rule of law and the proper administration of justice; 2. act with integrity; 3. not allow your independence to be compromised; 4. act in the best interests of each client; 5. provide a proper standard of service to your clients; 6. behave in a way that maintains the trust the public places in you; 7. comply with your legal and regulatory obligations and deal with your regulators and ombudsmen in an open, timely and co-operative manner; 8.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; 9.run your business or carry out your role in the business in a way that encourages equality of opportunity and respect for diversity; and 10.protect client money and assets.

5 SRA Handbook 2011—compliance SRA Principles 7 and 8 o comply with your legal and regulatory obligations o run your business or carry out your role in the business effectively and in accordance with proper governance SRA Outcomes 7.2 and 7.3 o effective systems and controls to comply with SRA Handbook o identify, monitor and manage risks to compliance with SRA Handbook Indicative behaviours

6 The Firm’s Manuals As indicated earlier we have developed a series of manuals and other material designed to provide staff with essential guidance to assist the firm and staff in ensuring that we all comply with our obligations. These are located on the intranet and include the following: Compliance Manual Anti Money-Laundering and Counter Terrorist Financing Manual Risk Management Manual Office Procedures Manual Staff Handbook The Firm’s Policies Compliance Bulletins Training Aids

7 The cost of non-compliance Damage to reputation Complaint to Legal Ombudsman Disciplinary action by SRA or SDT o reprimand o fine o suspension/struck off as solicitor o disqualified as COLP/COFA o firm authorisation withdrawn Criminal prosecution—fines/prison

8 COLP and COFA Job titleResponsibilitiesName Compliance officer for legal practice (COLP) Ensuring compliance with the SRA Handbook (except the SRA Accounts Rules) and all other regulatory requirements that apply to the firm Teresa Payne. Her deputy is Nigel Harper Compliance officer for finance and administration (COFA) Ensuring compliance with the SRA Accounts Rules Teresa Payne. Her deputy is Nigel Harper

9 Internal compliance duties COLP/COFA duties: o establish policies and processes o monitor compliance o record compliance failures o report material failures to SRA Staff duties: o comply with policies and procedures o report suspected compliance failures

10 Compliance arrangements Policies and procedures Registers Manuals Compliance Manager Review of compliance arrangements Compliance Bulletins SRA and Law Society Websites Training and Lexis Nexis resources

11 Reporting compliance failures Who has a duty to report? Why report? What to report? The reporting process What happens next? Potential outcomes Blame culture

12 Summary Importance of compliance The COLP and COFA OFR and SRA Handbook Compliance arrangements, manuals and review Reporting compliance failures

13 Final comments Any questions? to Update your training records in Compliance Manager