Risk in the legal profession

In a change from its usual Risk Outlook, the SRA has published the results of independent research into what the legal profession itself identifies as the highest risks and how they mitigate them.

The Code of Conduct for Firms 2.5 requires law firms to ‘identify, monitor and manage all material risks to your business, including those which may arise from your connected practices’.

We recommend a centralised risk register which identifies the key risks to your business and how you mitigate them (e.g. policies and procedures, team training), and any actions that you need to take. This should be reviewed quarterly, and updated by taking into account the SRA’s latest Risk Outlook and Warning Notices and issues that have arisen within the firm.

The results of the survey are in many ways no great surprise, with the biggest risks identified as:

• Regulatory compliance
• Money laundering/sanctions
• Cybercrime – increasing volume and sophistication
• Recruitment and retention
• Inflation/increasing overheads

Three steps to take to mitigate these risks

1. Review your firm’s risk register – have you identified all the risks and mitigations?
2. Incorporate these risks into the firm’s business continuity plan
3. Train your team – they are your first line of defence against the risks of money laundering and cybercrime, and working at the coal face of implementing regulatory compliance

Do you need help with this?

If you’re worried about the risks of cybercrime, money laundering or regulatory compliance, we offer a range of courses delivered by subject matter experts, including Dr Anne Austin, Edward Austin, and Paul Stratton.  Links to these courses can be found on our website here.  Or, please do get in touch for a chat.