By Carolyn Beal, Legal Compliance Consultant, Beal Cooper Compliance Ltd
In these days of constant regulatory change, what should firms focus on?
The following questions will help spotlight important areas for your firm:
1. Are we meeting regulatory expectations, or only ticking boxes?
This must be considered and is key to effective compliance. An approach of ‘just get the box ticked’ will never work. The same goes for beautifully written policies, which only their author knows about. Firms must demonstrate embedded compliance.
Check Regulators’ expected outcomes. Evidence of compliance is key, as the slew of recent fines following SRA AML audits has shown. Are you up to date with current regulatory requirements? How do you demonstrate the requirements are met day-to-day? Do your file reviews check those requirements?
2. Can we demonstrate appropriate leadership oversight?
All Regulators expect good governance and clear ownership of compliance. Firms should periodically assess how well the oversight is working. Is compliance covered at Board-level meetings? Do your COLP and COFA receive support from the top?
Support for compliance roles is very topical after the recent request by the SRA for permission from the Legal Services Board to separate compliance and leadership roles. The proposals include: “Individuals who can make significant decisions about how the firm is run, cannot also be the compliance officers for legal practice and finance and administration.” This may cause its own problems, but is driven by the high profile collapse of firms such as Axiom Ince. Governance and leadership must remain a focus.
3. How confident are we that colleagues know what to do when something goes wrong?
A problem reported early is much easier to manage than one kept under wraps, whether it’s a mistake, a data breach, or ethical issue. When did you last train your colleagues on what to do? Does your culture support it? Publication of ‘near misses’ or real life examples, and how to learn from them, are a great way to remind people of the importance of an appropriate response.
Policies should make expectations clear and include guidance for when something goes wrong. In June 2026, formal whistleblowing protections were granted to those working in or with the legal sector who report to the SRA, emphasising the importance of reporting duties.
4. Are our data protection and cybercrime protection processes fit for current threats?
Data protection has been shaken up with the recent Data Use and Access Act 2025. Cybercrime remains one of the biggest threats to law firms.
Would you be ready to respond to a data breach? Do you know the timescales for making a report to the Information Commissioner? Do you treat cyber-security only as an IT function, or is it considered at Board-level?
The SRA recently published a warning about the risk of AI deepfakes being used to bypass identify verification processes. Have you informed your colleagues of the risks and how to address them?
5. If we started the firm today, would our compliance look the way it does now?
Many long-established firms have ‘Frankenstein’ documents that have been changed and added to over the years, to meet changing regulatory needs. They can be outdated, confusing, and contain conflicting procedures. They often fail to meet their purpose. Periodic reviews ensure proportionality and relevance, so they always meet your firm’s needs. Consider tech solutions, too. As firms grow and change, compliance must keep up.
It can feel impossible to find the time and resource to review compliance. Starting with these questions will provide reassurance, or a framework for starting the detailed review. Contact me if you would like support with it.
www.bealcoopercompliance.co.uk