Major legal groups in the UK are pushing back hard against a government plan to change how lawyers are monitored for financial crime. The Law Society and the Bar Council, representing solicitors and barristers in England and Wales, have objected to proposals that would hand anti-money laundering oversight for the legal sector to the Financial Conduct Authority. They argue the plan for a Single Professional Services Supervisor creates more problems than it solves, potentially increasing bureaucratic burdens while diluting expertise.
The Law Society warned the shift could fragment regulation instead of simplifying it, contradicting the government's stated goal of reducing business red tape. Key concerns include protecting client confidentiality under the FCA's broader powers, avoiding duplicate investigations with the existing Solicitors Regulation Authority, and maintaining strong safeguards for suspicious activity reports. Legal experts echoed these points, noting the vague proposal for new fitness assessments on lawyers seems to add administrative cost without clear benefit, given the existing stringent approval processes.
The Bar Council emphasized the risk of losing specialized supervisory knowledge under a one-size-fits-all FCA model, noting the current Bar Standards Board system works effectively. They highlighted that very few barristers actually handle work falling under anti-money laundering rules, often being instructed by other already-regulated professionals. Both bodies criticized the lack of detail on how the new system would be funded, calling for fee structures that accurately reflect the distinct risk profiles and minimal oversight needed for most legal practices compared to other financial services. They urged the government to slow down and address these operational risks before proceeding.
The Law Society warned the shift could fragment regulation instead of simplifying it, contradicting the government's stated goal of reducing business red tape. Key concerns include protecting client confidentiality under the FCA's broader powers, avoiding duplicate investigations with the existing Solicitors Regulation Authority, and maintaining strong safeguards for suspicious activity reports. Legal experts echoed these points, noting the vague proposal for new fitness assessments on lawyers seems to add administrative cost without clear benefit, given the existing stringent approval processes.
The Bar Council emphasized the risk of losing specialized supervisory knowledge under a one-size-fits-all FCA model, noting the current Bar Standards Board system works effectively. They highlighted that very few barristers actually handle work falling under anti-money laundering rules, often being instructed by other already-regulated professionals. Both bodies criticized the lack of detail on how the new system would be funded, calling for fee structures that accurately reflect the distinct risk profiles and minimal oversight needed for most legal practices compared to other financial services. They urged the government to slow down and address these operational risks before proceeding.
