SRA claims Dentons failed to adequately ascertain the source of wealth or funds of a client
International law firm Dentons has levelled accusations against the Solicitors Regulation Authority (SRA), asserting that the regulatory body has adopted a “revisionist approach” in its pursuit of alleged misconduct dating back a decade.
As The Law Society Gazette reported, Richard Coleman, in representing Dentons at the Solicitors Disciplinary Tribunal, argued that the SRA has “lost sight of context” in its prosecution against the firm. The allegations by the SRA claim that Dentons failed to adequately ascertain a client's source of wealth or funds between 2013 and 2017. Notably, the client, whose identity is protected by an anonymity order, hails from an authoritarian former Soviet state infamous for corruption and served as the chairman of a state-majority-owned bank.
During the tribunal proceedings, it was revealed that Dentons, after its merger with legacy firm Salans in 2013, entrusted its client relationship manager, Francois Chateau, with conducting checks on the client’s financial background. However, according to The Law Society Gazette, no documentation from this period was available.
Coleman contended that the SRA’s prosecution reflected a “2024 mindset,” applying contemporary anti-money laundering guidelines retroactively to actions taken over a decade ago. He argued that Dentons had adhered to the prevailing standards and guidance of the time.
Furthermore, Coleman emphasized that even if the tribunal were to find breaches in the 2007 regulations, Dentons maintained that they were not of sufficient gravity to warrant disciplinary action.
Arguments in the case
In his defence of Dentons, Coleman highlighted the ambiguity of the standards the SRA held the firm to, particularly noting that the regulatory landscape had evolved significantly since the period in question.
“The firm is not asking the tribunal to approve the approach taken as being appropriate today. The approach taken 10 years ago is not one that would pass muster today in the very different environment,” said Coleman.
The crux of Dentons’ defence rested on the assertion that any breaches were inadvertent and unrelated to the firm’s internal protocols, with no evidence of harm resulting from their actions.
During cross-examination, SRA investigator Sean Grehan refuted accusations of applying current guidelines retroactively, citing an interview with Chateau where cultural differences were cited as a barrier to detailed financial inquiries.
The hearing is ongoing, with Dentons defending its actions in what is shaping up to be a pivotal case regarding applying regulatory standards across different temporal contexts.
