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My year in compliance



According to LinkedIn, I have just celebrated my first year as the Risk and Compliance Manager at Mogers Drewett – obviously nothing can now be true unless I have first heard it on social media, but it got me thinking about the changes that have taken place over the last 12 months.

January saw the introduction of the 5th Money Laundering Direct or 5MLD as it is affectionately known.  Brought in at the very last minute, because the government’s parliamentary timetable was filled with Brexit legislation, the new directive required money laundering procedures to be quickly changed to take into account new requirements for increased awareness of the potential risks from clients and transactions involving 23 ‘high risk’ countries, extended reporting requirements on beneficial ownership, the need to inform Companies House in our client due diligence investigations and their records, plus the need to be aware of something called ‘bitcoin’, which luckily Mogers Drewett are not involvement with.

Dealing with 5MLD was nothing as compared to what happened next.

It is hard to over exaggerate the impact that lock down had on compliance.   To go from working in a busy modern office to being at home alone in the back bedroom, is quite a dramatic change and everyone had to get used to working in what could seem like an isolated bubble.  Every compliance procedure had to be considered in the light of this new “normal”, because compliance is not something that unfortunately can just be put aside for the day when there is no more pandemic. It has to carry on as long as the organisation is able to continue working.

The first challenge was how to get certified ID from clients at a time when no one wanted to go out to show their passport or driving license to anyone.  The solution involved some inventive use of Zoom and clients holding up their passports to their webcams.  Then there was the challenge of how to supervise members of staff who were used to easily getting advice and input from senior members of staff.  That was again sorted by using Zoom and regular catch ups, which were an invaluable way to ensure that everyone was in contact with each other and maintain moral as well.

Just a month into lock down and we had our 6 monthly ISO quality audit.  Carried out remotely over 3 days, this assessment of our compliance procedures and business practices resulted in us not only getting a clean bill of health, but being told by the assessor that we were an “exemplary demonstration” of good management systems, which in the circumstances was an unbelievable result.  If that was not enough, in May we then had the Solicitors Regulation Authority, carry out an assessment on our anti-money laundering procedures and policies, looking particularly at how we had adapted to homeworking. I was really pleased that we again got a clean bill of health, as no one wants to get a bad assessment from their regulator.

The great compliance lesson from the pandemic, other than how to use Zoom, is the importance of ensuring that your procedures are paper free as they can be, but also flexible.   This means that they need to be less time consuming for everyone, whilst at the same time maintaining the high standards that the firm always sets.