Question to the Ministry of Justice:

To ask the Secretary of State for Justice, whether she has received representations from the Solicitor Regulation Authority on the adequacy of the level of financial penalties for those solicitors found to be in breach of money laundering regulations.

The legal profession in England and Wales operates independently of government. The responsibility for regulating the sector sits with the approved regulators, overseen by the Legal Services Board.

The Solicitors Regulation Authority (SRA) is responsible for regulating the professional conduct of solicitors, as well as most law firms in England and Wales. The SRA’s role involves protecting clients and the public, which means they have powers to issue fines and prevent solicitors in breach of their standards and regulations from practising. While the Government does not generally play a direct role in setting fining powers, the Economic Crime and Corporate Transparency Act 2023 (ECCTA) facilitated the introduction of measures to increase the SRA’s fining capabilities in relation to economic crime. However, the responsibility to consult and propose new fining levels for economic crime related matters still sits with the SRA.

The LSB is currently reviewing regulators' enforcement powers as part of its wider efforts to improve the legal services sector. This review focuses on assessing whether the enforcement powers of the regulators are sufficient, effective, and proportionate. Any changes to regulator fining powers are made by an application (under s69 of the Legal Services Act 2007) from the Legal Services Board to the Lord Chancellor. The Government has not received an application for such a change.