Beacon Legal Management & Compliance

02/07/2021

The Age Appropriate Design Code (aka, the Children’s Code) came into force on 2nd September 2020, with a 12-month transition period. Organisations are expected to conform to the code from 2nd September 2021.
Useful information and a guide to the code is available free on the internet at www.dpnetwork.org.uk/childrens-code-privacy. In addition, a free webinar is available at https://www.dbxuk.com/webinars-2021/an-introduction-to-the-childrens-code

The Children's Code, formerly known as The Age Appropriate Design Code came into effect on 2nd September 2020, with a 12-month transition period. The Code of Practice translates the GDPR into design standards for apps, online games, and web and social media sites, likely to be accessed by children.

20/01/2021

Today sees the launch of the revised Legal Sector Affinity Group (LSAG) anti-money laundering guidance – all 222 A4 sides of it. Law firms which undertake work in the “regulated sector” need to ensure that their policies, controls and procedures are up to date so this is essential reading for Money Laundering Compliance Officers. Key changes include expanded guidance on source of wealth and source of funds, A new section on the use of technology, guidance on risk assessments at firm, client and matter level, revised governance and internal controls sections, and clarifications on high-risk sectors, accepting cash, and timing of Client Due Diligence. Don’t assume your existing policies controls and procedures are adequate – there’s a very high chance that they aren’t. AML is still top of the SRA’s list of risks and is an issue on which they are very focussed.

The anti-money laundering (AML) guidance produced by the legal sector AML supervisors, including the Law Society, has now received the approval of HM Treasury.

04/12/2020

The recently published annual SRA Risk Outlook is not just something to be nodded at in passing. It needs careful consideration and will likely require law firms to update their Risk Registers. It may also involving creating or revising existing policies and procedures. It's also a useful pointer at the likely focus of the SRA over the coming 12 months, and even the direction of SRA policy. Don't ignore it!

This Risk Outlook is designed to help you develop and update your own risk assessments.

26/11/2020

A £14k fine for a midlands law firm for failure to spot “red flags” in a conveyancing matter should be a salutary lesson for any firm doing this type of work on the risks inherent in an inadequate AML policy.

The work involved the sale of a property on instructions received under a power of attorney. The firm verified the identity of the attorney, but not of the of actual seller. The firm did not meet either the seller or the attorney in person. The certified copies of the identity documents supplied did not confirm that the certifier, who was not known to the firm, had met the parties.
The Land registry is refusing to register the disposition of the property.

In another matter, the firm had failed to establish the origin of funds used in a transaction and failed to make sufficient checks to ensure they were legitimate. Red flags were missed such as the firm and the clients being based in different geographical areas.

Under the 2017 Money Laundering Regulations, firms covered by the regulations should establish an independent audit function to evaluate, monitor compliance with, and improve the effectiveness of its AML policies, controls and procedures.

Get in touch if you need help.

SRA announces sanction in the same week as renewing calls for extra due diligence on clients.

05/09/2020

How often should you change your password? Once a month? Once every two months? Once every three months? How about never?! Did you know that the National Cyber Security Centre (NCSC) recommends that businesses should not require computer users to regularly change their passwords since this leads to “password overload” and results in unsafe practices by users to enable them to cope.

How complex should passwords be? You may also be surprised to learn that the NCSC also recommends against complexity requirements because the difficulty in remembering them also leads to unsafe practices by users. Whilst there should be a minimum length requirement, there should not be a maximum (subject to any constraints of the system). The recommended approach is to use the “three random words” technique to produce a password that is almost unbreakable.

The detailed guidance is excellent and is recommended for system owners and administrators in particular

Advice for system owners responsible for determining password policies and identity management within their organisations.

01/11/2019

After reviewing 400 firms and finding 21% were not complying with anti-money laundering regulations, the SRA has decided that it will check a further 7,000 firms. There are around 11,000 firms in England and Wales so the chances of YOUR firm being one of them is over 60%. Are you ready?!

They note that too many firms are relying on templates for firm-wide risk assessments which they are then not adapting to their own specific situation. Many apparently do not understand their responsibilities in relation to PEPs. Many are devising risk assessments only when asked by the SRA to produce them.

Is your firm required under the 2017 MLR to have an independent audit of its AML policies and procedures?
Don't wait until the SRA calls to find out...

16/05/2019

A little light reading from the Legal Ombudsman on what they feel is good practice in relation to costs information given to clients. Bear in mind that when they deal with complaints about costs, they will judge firms against this.

https://www.legalombudsman.org.uk/wp-content/uploads/2019/05/190509-An-Ombudsman-view-of-good-costs-service.pdf

25/01/2019

The professional indemnity insurance market for law firms is hardening in a way "not seen for many years" according to The Law Society and this mirrors what I'm being told by various brokers.

For firms to obtain cover, and to get it at an affordable rate, it's no use just relying on the proposal form in these conditions. Potential insurers want to know how you manage risk, what policies and procedures you have in place, supervision arrangements and plans for the future - and more.

Now, more than ever, a firm's chances of obtaining good, affordable cover can only be enhanced by being accredited under a recognised quality standard that involves regular independent audits such as the Law Society's Lexcel Legal Practice Quality Mark or ISO 9001.

One of the major risks to firms currently is, of course, cyber-crime and fraud so have a look and see how the Cyber Essentials accreditation can help too.

18/10/2018

With just a little over six weeks until the coming into force of the SRA’s Transparency Rules, how are you getting on with your preparations?

The SRA is insistent that it’s not all about price but it’s hard to escape the conclusion that with the requirement to publish prices, there could well be a race to the bottom. So how are you going to set yourself apart from the rest and “justify” the fees you charge? How are you going to persuade visitors to your website that, whilst you may not be the cheapest in town, you are the best?

Might I suggest that if you are the proud holder of a Lexcel accreditation or other quality mark, you trumpet it load and clear on your website including, if necessary, explaining what the quality mark actually is and what the benefits are for clients.

In the case of Lexcel, as well as educating website visitors as to what it is, you might point out that only around 16% of law firms have been awarded the accreditation – and you are one of them.

If your firm hasn’t got the accreditation yet, maybe now is the time …