Between September 2015 and April 2017, Mishcon de Reya carried out work for two individual clients, and corporate vehicles connected with the same two individual clients.
The SRA said the firm failed to retain the hard copy file of the documents, and not a full set of CDD documents were obtained in relation to one of the corporate vehicles involved in the acquisition.
Both acquisitions reportedly presented a “higher risk of money laundering or terrorist financing” under the relevant money laundering legislation as they involved companies in high-risk jurisdictions, which requires enhanced customer due diligence (EDD) and ongoing monitoring which “was not adequately applied”.
During an external investigation, it was identified that the firm’s former partner responsible for the two clients had not received mandatory training as required by anti-money laundering regulations.
Mishcon de Reya said that the training wasn’t provided due to a personnel absence and the firm admits the procedures did not adequately mitigate against the risk of non-compliance.
As a result, the relevant customer due diligence (CDD) documents in relation to the transactions were later obtained and provided to the SRA.
The firm has also amended its policies and procedures, including introducing and investing in new IT systems which involve increasingly centralised record-keeping and are designed to prevent future breaches.
A spokesperson for Mishcon de Reya told Legal Brief: “We are pleased to have come to a settlement with the SRA relating to two separate and historic investigations in relation to which we have made appropriate admissions.
“Mitigating factors such as our cooperation with the SRA throughout the investigations and the corrective action we have taken since to prevent a recurrence have been recognised by the SRA in reaching this outcome.”