Sometimes the most telling compliance stories are not about scandal but about silence.

That was the case in Northwich, where a small solicitors’ firm, Chambers Fletcher, has been fined nearly £17K by the SRA. There was no client complaint, no criminal activity, no missing funds.

Just ten years of doing nothing. And that’s what made it so serious.

What happened?

Following a regulatory review, the SRA found that Chambers Fletcher had gone more than a decade without maintaining compliant anti-money laundering (AML) systems.

• For the first half of that period, the firm had no AML policies at all. 
• For the second half, it had inadequate policies and no client or matter risk assessments. 
• There was no evidence of AML training, and no clear understanding among staff of their obligations. 

In effect, the firm was operating in breach of both the Money Laundering Regulations 2007 and the Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017 as well as the SRA Principles 2019 and SRA Code of Conduct.

When confronted, the firm admitted all breaches and cooperated fully with the investigation. It has since updated its systems and achieved compliance.

But that did not spare them from penalty. The SRA imposed a fine of £16,880 and investigation costs of £600, with a clear warning that complacency is no longer acceptable.

What exactly did the firm do wrong?

The firm’s downfall wasn’t misconduct. It was inertia.

For over ten years, nothing was reviewed, revised or refreshed. The AML policies sat unchanged while the regulatory landscape evolved dramatically. The SRA called it a “serious anti-money laundering control failing,” one that could have allowed money laundering or terrorist financing to go undetected.

In other words, the firm may not have been exploited by criminals but it had created the perfect conditions for that to happen. Compliance isn’t about reacting to problems; it’s about preventing them.

Small firms are not exempt

This case should make every small and mid-sized practice in the UK and Northern Ireland pause. For years, many smaller firms assumed AML scrutiny was something that happened to big city practices or firms handling complex, high-value transactions.

That assumption no longer holds. Regulators are casting a wider net and they expect even the smallest firm to:

• Maintain an up-to-date Firm-Wide Risk Assessment (FWRA) 
• Demonstrate how client and matter risks are identified and recorded 
• Ensure staff understand both the “why” and the “how” of AML controls 

The real danger lies in firms believing that “nothing has gone wrong” is still a defence.

What should law firms do to avoid the same fate?

1. Keep your risk assessment alive

Your FWRA is not a one-time exercise. Update it to reflect changes in practice areas, client profiles, sanctions exposure, and new regulatory risks.

2. Refresh policies and procedures

Generic templates won’t cut it. Your AML policies must reflect how your firm actually works with its people, clients, and systems.

3. Document the ‘why’

When assessing client risk, record the reasoning, not just the result. The SRA wants to see evidence of understanding, not box-ticking.

4. Train for understanding, not compliance

Annual tick-box training isn’t enough. Fee-earners, partners, and support staff need role-specific training that connects AML rules to real-world scenarios.

5. Audit and review regularly

Set up internal checks. Even small firms can run quarterly file reviews or mock audits to ensure that systems are operating as intended.

The real cost of inaction

The fine itself of £17K might not break a firm but the reputational hit can. Once an AML breach is published, it undermines client confidence and raises questions about a firm’s professionalism. Regulators and peers start to view the firm not as unlucky, but as careless. And in the eyes of the SRA, good intentions are no substitute for active compliance.

This case isn’t about bad actors but about good professionals who let time pass. Ten years of quiet inaction turned into a public reprimand. For law firms everywhere, the message is that AML compliance is not optional, and it’s not static. It is a living, ongoing responsibility that requires attention, documentation, and understanding, no matter your firm’s size or client base. If your firm hasn’t reviewed its AML framework this year, start now. Don’t wait for the regulator to remind you.

Now more than ever, training your staff in AML needs to be more than a tick-box exercise. Companies and law firms can easily fall out of compliance or get caught up in dirty money without a robust AML framework. Our suite of AML courses will help you stay protected. Try it now.