Amphlett Lissimore Faces £114k SRA Fine for Anti-Money Laundering Failures

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The recent £114,006 penalty imposed by the Solicitors Regulation Authority (SRA) against Amphlett Lissimore Bagshaws has sharpened attention on the persistent challenge of anti-money laundering (AML) compliance in the UK legal sector. This sizeable SRA fine—one of the largest issued to a law firm for AML failings—highlights ongoing regulatory scrutiny of law firm compliance practices and the real consequences for firms that fall short of the requirements under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017.

Amphlett Lissimore’s failings, which stretched over four years, centred on not maintaining adequate policies, controls, and procedures (PCPs) and failing to conduct robust client and matter risk assessments (CMRAs). These core AML obligations are not optional, but foundational requirements that underpin the UK’s legal sector defence against criminal abuse. The outcome serves as a stark reminder that regulators are prepared to use their full fining powers where law firms demonstrate persistent non-compliance.

Anti-Money Laundering Regulations and Law Firm Compliance

Anti-money laundering regulations require every UK law firm to implement comprehensive systems to prevent and detect the movement of illicit funds through legal services. Under the 2017 Money Laundering Regulations—formally known as the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017—law firms must establish documented policies, controls, and procedures. These must address key AML risks relevant to their business model, client base, and service offering.

A firm-wide risk assessment is a core expectation, as is the requirement to conduct client and matter risk assessments (CMRAs) for every new engagement and periodically throughout the business relationship. The Solicitors Regulation Authority makes it clear through regular guidance and enforcement notices that paper compliance is not enough: systems must be embedded, up to date, and demonstrably effective in practice.

Failing to implement or maintain these measures is not just a technical breach. Such failings undermine the broader UK AML framework, as the legal sector is often targeted for abuse by criminals seeking to launder proceeds from fraud, tax evasion, or other predicate offences. Enforcement action is designed to protect public confidence in the profession and ensure that UK legal services cannot be exploited for financial crime.

The SRA’s fining policy, last updated in 2023, enables the regulator to impose penalties of up to £25,000 on traditional law firms. However, for alternative business structures (ABS) like Amphlett Lissimore, the SRA’s statutory powers extend much further, allowing for fines up to £250 million. This substantial upper limit was introduced to ensure a proportionate deterrent, particularly as ABS structures become more prominent within the UK legal market.

SRA Fine: A Case Study in Persistent AML Non-Compliance

The SRA’s investigation into Amphlett Lissimore’s compliance failures followed a desk-based review by its AML proactive supervision team, an approach the regulator uses to systematically assess high-risk firms. Between December 2019 and March 2024, Amphlett Lissimore was found to have operated without adequate AML controls. Most notably, the firm lacked a functioning client and matter risk assessment process and could not evidence that its AML procedures were fully compliant with regulatory requirements.

Despite the absence of deliberate concealment or fraud, the regulator determined that these breaches persisted for an unacceptable period, potentially undermining public trust in legal services and exposing the sector to criminal exploitation. The penalty imposed was calculated as 2% of the firm’s annual turnover—well above the maximum for traditional practices but consistent with SRA guidance for ABS entities.

Mitigating factors played a significant role in the outcome. Amphlett Lissimore cooperated fully with the investigation, rectified its AML procedures, and introduced a proper CMRA process once failings were identified. Nevertheless, the SRA emphasised that the length of the breach, and the firm’s initial lack of core AML systems, warranted a strong financial penalty and publication of the decision.

The case is not an isolated incident. Recent enforcement trends show a steady stream of SRA fines against legal practices that have been unable to evidence firm-wide risk assessments or effective AML procedures. Many of these firms, including several recently fined for similar breaches, are members of industry schemes such as the Law Society’s Conveyancing Quality Scheme (CQS) or Lexcel. These quality marks both require robust AML compliance, raising questions about the adequacy of internal monitoring and external accreditation processes.

The Practical Impact of AML Enforcement on the UK Legal Sector

Fines like the one imposed on Amphlett Lissimore serve a dual purpose: they penalise past misconduct but, more importantly, drive sector-wide improvement in AML compliance. UK legal services are seen as gatekeepers in the fight against financial crime, and the SRA’s enforcement priorities increasingly reflect a zero-tolerance approach to repeated or serious breaches.

Law firms are expected to maintain up-to-date AML policies tailored to their particular risks. This includes:

Ensuring a firm-wide risk assessment is current, regularly reviewed, and used to inform operational controls
Implementing client and matter risk assessments that go beyond box-ticking, genuinely assessing the risk of money laundering in each transaction
Maintaining records and audit trails that allow for supervisory inspection
Ensuring staff are regularly trained on emerging threats, typologies, and regulatory expectations
Integrating AML checks into onboarding and matter management software where possible

Recent enforcement actions by the SRA, as well as parallel actions by the Council for Licensed Conveyancers (CLC) and the Law Society of Scotland, signal that passive or superficial compliance is not sufficient. Firms that fail to demonstrate embedded and operational AML systems face meaningful financial penalties, reputational harm, and potentially further regulatory intervention.

The sector must also contend with evolving regulatory thresholds. As of 31 July 2025, the UK’s threshold for submitting a Defence Against Money Laundering (DAML) suspicious activity report (SAR) will increase from £1,000 to £3,000. This means legal practitioners do not commit a money laundering offence if the value of suspected criminal property in a transaction is less than £3,000, reflecting changes to the Proceeds of Crime Act 2002 (POCA) reporting regime. Regulatory bodies such as the CLC have issued updated guidance, particularly relevant for conveyancers handling routine client payments.

AML compliance for law firms is no longer simply about avoiding fines. Regulators are focusing on the ability to detect and report suspicious activity, respond to new financial crime typologies, and maintain public trust in the sector’s integrity. The SRA has also published thematic reviews highlighting the recurring weaknesses in AML controls across firms, often citing failures in risk assessment, record-keeping, and ongoing monitoring as areas of concern.

Industry Accreditation, Quality Schemes, and AML Gaps

The Amphlett Lissimore case brings renewed focus to the role of industry accreditations in promoting AML compliance. Schemes such as the Conveyancing Quality Scheme (CQS) and Lexcel are designed to raise standards in the sector, and both explicitly require participating firms to comply with AML laws and guidance. However, repeated enforcement action against member firms has raised concerns about whether these schemes provide sufficient scrutiny of AML practices.

Legal sector accreditation bodies and the SRA are now under pressure to increase oversight, ensure that self-attestation and periodic audits are rigorous, and take swift action where shortcomings are identified. For law firms, membership of a quality scheme should not be seen as a substitute for comprehensive, ongoing risk assessment and control.

Law firms should expect the following as part of accreditation and regulatory scrutiny:

Annual reviews of AML controls as part of the CQS and Lexcel compliance cycle
Evidence of staff training and awareness on new money laundering typologies
Documentation of ongoing risk assessments at both firm-wide and matter-specific levels
Demonstration that policies and procedures are adapted promptly in response to regulatory updates

Increasingly, regulators are drawing a direct line between failures in these areas and increased vulnerability to financial crime, justifying higher penalties where accreditation does not translate into practical compliance.

Strengthening the Legal Sector’s AML Resilience

The SRA’s decision to impose a £114,006 fine on Amphlett Lissimore Bagshaws reflects a regulatory environment that demands more than policy documents and formal accreditation. The expectation is for dynamic, proactive anti-money laundering frameworks that are capable of adapting to both evolving criminal tactics and shifting regulatory thresholds.

The UK legal sector continues to face scrutiny from domestic and international bodies, including the Financial Action Task Force (FATF), which in its latest mutual evaluation identified law firm compliance as a key element of the national AML regime. With increased reporting thresholds and enhanced regulatory powers, the burden is now squarely on law firms to demonstrate that anti-money laundering obligations are embedded in everyday practice and not just a box-ticking exercise.

For firms that have yet to overhaul their AML risk management, the message is clear: enforcement action is now both likely and costly, and cooperation alone is not sufficient to avoid major penalties. Comprehensive, ongoing risk assessments, robust controls, regular staff training, and genuine oversight by senior management are now non-negotiable requirements.

Law firms looking to avoid regulatory censure must see AML compliance as a core business priority, not just a legal obligation. Only a holistic, well-resourced approach can safeguard both firm reputation and the integrity of the UK’s legal services market.

Source: Legal Futures

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