Regulator probes law firms accused in Parliament over oligarch work

Philip: Writing to MPs and peers

The Solicitors Regulation Authority (SRA) has started visiting law firms named in Parliament amid concerns about their work for Russian oligarchs, it has emerged.

It forms part of a series of actions the regulator is taking in the wake of Russia’s invasion of Ukraine.

In his update for the recent meeting of the SRA board, chief executive Paul Philip noted that there have been a number of comments made in Parliament, both in general and about specific firms, “that lawyers are helping individuals included on the sanctions list to seek a defence, are not conducting proper checks on clients, or are threatening litigation in a way designed to stifle public debate and discourage public criticism, known as strategic litigation against public participation (SLAPPs)”.

He said the SRA was writing to the MPs and peers making allegations to ask for further information, “in order to investigate any misconduct”.

Further, it was “commencing visits to those firms named in the Parliamentary debate, and engaging in further visits as part of our ongoing rolling programme of inspections to ensure compliance with the money laundering regulations”.

As we reported last month, the SRA has also started a process of spot checks of firms to assess compliance with the financial sanctions regime.

Mr Philip said the regulator has also been “in touch” with the firms that fall within its regulatory management regime – “magic and silver circle firms conducting high-profile corporate, commercial and finance work, other large City and international firms, national firms, US firms with offices in England and Wales, and multi-disciplinary practices – to make sure they understood their obligations and the importance of compliance in this area.

Other actions included reminding firms of their obligations to comply with anti-money laundering requirements and the sanctions regime, issuing guidance on balancing duties in litigation, including SLAPPs, and engaging with stakeholders such as the Office for Professional Body Anti-money laundering Supervision, the Legal Services Board, Ministry of Justice and the Solicitor-General.

Mr Philip added: “There will be unidentified costs for some of this work that we will need to cover both in this and next year’s budget.

“The main costs will be a system to check firms’ clients against the financial sanctions lists, which is necessary because of the number of clients and entries on the list involved and to eliminate false positives.”

Back in January, before the invasion began, Conservative MP Bob Seely called on the government to “end the cancer” of high-end law firms selling “intimidation services” to oligarchs and others trying to use the legal system to silence journalists and critics.

In late February, Lord Carlile QC told the House of Lords that it was “probably fair to say that there is a host of law firms that have been involved” in the so-called London laundromat – helping Russians launder money.

Yesterday, we reported leading media lawyer Mark Stephens saying that mid-tier London law firms were “rubbing their hands with glee” at an influx of new oligarch clients turned away by the big City practices.

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