The Law Society of England and Wales has today (17 December)
opposed the creation of a Single Professional Services Supervisor
(SPSS).
In its response to the UK government's consultation on proposals
to reform of the Anti-Money Laundering (AML) and
Counter-Terrorism Financing (CTF) supervision regime, the Law
Society raised concerns which include:
- The introduction of the SPSS model poses major operational
and strategic risks for the profession while offering no proven
benefits. It currently fails to resolve fundamental challenges
created by dual regulation.
- Avoiding unnecessary cost and additional regulatory burden as
supervision shifts from the Solicitors Regulation Authority (SRA)
to the Financial Conduct Authority (FCA). Any changes must be
grounded in proportionate, risk-based oversight that reflects the
realities of legal practice. The proposals currently do not
demonstrate how this will be achieved.
Law Society president, Mark Evans, said: “The AML reforms risk
greater fragmentation, not simplification, and fly in the face of
the government's own growth agenda.
“The speed at which the government is consulting on the reforms
is a concern, as these changes will fundamentally reshape AML/CTF
oversight across all sectors.
“We remain committed to working with the Treasury to deliver
effective, proportionate and sustainable reform. However,
meaningful reform cannot be achieved through undue haste. Careful
consideration is essential to ensure both the integrity of legal
sector supervision and the smooth implementation of any changes.”
The Law Society has highlighted safeguards that must be
addressed:
- FCA information-sharing powers must protect client
confidentiality, avoid duplication, and be supported by clear,
sector-specific guidance. This is important in relation to
compromising and weakening the confidentiality and integrity of
Suspicious Activity Reports and whistleblowing protections.
- Preventing duplicate oversight, as the persistent issues
arising from overlapping disciplinary powers are not addressed in
this consultation.
- Transition arrangements must include grandfathering, phased
implementation and close coordination between the FCA, SRA and
Treasury.
Mark Evans concluded: “The AML proposals currently fall short and
risk adding complexity without delivering meaningful reform. We
urge the Treasury to consider whether a further period of
consultation is warranted allowing supervisors, professional
bodies and practitioners to contribute before any final decision
is made.”
Notes to editors
