Smith & Graham
1st Floor, Tranquility House, Harbour Walk, Hartlepool , TS24 80UX
Recognised body
55519

Decision - Agreement

Outcome: Regulatory settlement agreement

Outcome date: 21 July 2026

Published date: 23 July 2026

Firm details

No detail provided:

Outcome details

This outcome was reached by agreement.

Decision details

1. Agreed outcome

1.1 Smith & Graham (the firm), a Recognised Body authorised and regulated by the Solicitors Regulation Authority (SRA), agrees to the following outcome to the investigation:

1. to pay a fine of £6,380 under Rule 3.1(b) of the SRA Regulatory and Disciplinary Procedure Rules (RDPRs)
2. to the publication of this agreement under Rule 9.2 of the RDPRs
3. to pay the costs of the investigation of £600, under Rule 10.1 and schedule 1 of the RDPRs.

2. Summary of Facts

2.1 We carried out an investigation into the firm following a review by our AML Proactive Supervision team.

2.2 The Money Laundering, Terrorist Financing (Information on the Payer) Regulations 2017 (MLRs 2017), the SRA Principles (2019) and the SRA Code of Conduct for Firms (2019).

3. Allegation

3.1 Between 26 June 2017 and 22 April 2026, failed to maintain records of its risk assessment under Regulation 28 of the MLRs 2017. Therefore, the firm was unable to demonstrate that the extent of the measures it had taken to satisfy the requirements of Regulation 28 were appropriate, as required by Regulation 28(16) of the MLRs 2017.

4. Admissions

4.1 The firm admits, and the SRA accepts, that by failing to comply with the MLRs 2017, that it failed to comply with, or breached:

4.2 To the extent the conduct took place before 24 November 2019:

1. Outcome 7.2 of the SRA Code of Conduct 2011 - You have effective systems and controls in place to achieve and comply with all the Principles, rules and outcomes and other requirements of the Handbook, where applicable.
2. Outcome 7.5 of the SRA Code of Conduct 2011 - You comply with legislation applicable to your business, including anti-money laundering and data protection legislation.
3. Principle 6 of the SRA Principles 2011 - You must behave in a way that maintains the trust the public places in you and in the provision of legal services.
4. Principle 8 of the SRA Principles 2011 You must run your business or carry out your role in the business effectively and in accordance with proper governance and sound financial and risk management principles.

4.3 To the extent the conduct took place from 25 November 2019 onwards:

1. Paragraph 2.1(a) of the SRA Code of Conduct for Firms - You have effective governance structures, arrangements, systems, and controls in place that ensure: you comply with all the SRA's regulatory arrangements, as well as with other regulatory and legislative requirements, which apply to you.
2. Paragraph 2.2 of the SRA Code of Conduct for Firms You keep and maintain records to demonstrate compliance with your obligations under.
3. Paragraph 3.1 of the SRA Code of Conduct for Firms - You keep up to date with and follow the law and regulations governing the way you work.
4. Principle 2 of the SRA Principles - You act in a way that upholds public trust and confidence in the solicitors' profession and in legal services provided by authorised persons.

5. Why a fine is an appropriate outcome

5.1 powers where there has been a failure to meet its standards or requirements.

5.2 When considering the appropriate sanctions and controls in this matter, the SRA has considered the admissions made by the firm and the following mitigation:

1. there is no evidence of harm to consumers, or third parties, and our view is that the risk of repetition is low,
2. the firm brought itself into compliance by putting in place a compliant CMRA process in response to the feedback from the AML Proactive Supervision team, and
3. Investigations teams.

5.3 The SRA considers that a fine is the appropriate outcome because:

1. The conduct showed a disregard for statutory and regulatory obligations and had the potential to cause harm, by facilitating dubious transactions that could have led to money laundering (and/or terrorist financing). Taking a risk-based approach to preventing money laundering is important because it helps firms to direct resources appropriately to the highest risk areas. Firms need to understand and assess the risk posed by each client and matter, then act accordingly. The firm carries out half of its work in scope of the MLRs 2017. Most of the in-scope work relates to conveyancing, which our Sectoral Risk Assessment identifies as high risk.
2. It was incumbent on the firm to meet the requirements set out in the MLRs 2017. The firm failed to do so. The public would expect a firm of solicitors to comply with its legal and regulatory obligations, to protect against these risks as a minimum.
3. The agreed outcome is a proportionate outcome in the public interest because it creates a credible deterrent to others and the issuing of such a sanction signifies the risk to the public, and the legal sector, that arises when solicitors do not comply with anti-money laundering legislation and their professional regulatory rules.

5.4 Rule 4.1 of the Regulatory and Disciplinary Procedure Rules states that a financial penalty may be appropriate to maintain professional standards and uphold public confidence in the solicitors' profession and in legal services provided by authorised persons. There is nothing within this Agreement which conflicts with Rule 4.1 of the Regulatory and Disciplinary Rules and on that basis, a financial penalty is appropriate.

6. Amount of the fine

6.1 on its approach to setting an appropriate financial penalty (the Guidance).

6.2 We have assessed the nature of conduct in this matter as more serious (a score of three).

6.3 This is because the firm should have taken more care to ensure it fully understood its obligations to record CMRAs. The firm undertakes significant amounts of high risk inscope work (approximately 46% conveyancing) and has failed to meet this requirement of the MLRs 2017 for over eight years.

6.4 The harm or risk of harm is assessed as being low (score of two).

6.5 There is no evidence that the lack of CMRAs has caused harm to clients. There is also no evidence that the lack of recording CMRAs caused the firm to fail to identify its high-risk clients or apply the incorrect level of customer due diligence on matters. Further, the firm says that it was risk assessing clients and matters, just not recording the information to the file. This lowers the risk when compared to not considering risk factors to clients and matters at all.

6.6 The nature and impact scores add up to five. This places the penalty in Band B as directed by the guidance. The SRA and the firm agree that a basic penalty in the lower part of the bracket to be appropriate.

6.7 Based on the evidence the firm has provided of its annual domestic turnover for the most recent tax year; this results in a basic penalty of £7,089.

6.8 The SRA considers that the basic penalty should be reduced to £6,380. This reduction reflects the mitigation set out in paragraph 5.2 above.

6.9 The firm does not appear to have made any financial gain or received any other benefit because of its conduct. Therefore, no adjustment is necessary, and the financial penalty is £6,380.

7. Publication

7.1 Rule 9.2 of the SRA Regulatory and Disciplinary Procedure Rules states that any decision under Rule 3.1 or 3.2, including a Financial Penalty, shall be published unless the particular circumstances outweigh the public interest in publication.

7.2 The SRA considers it appropriate that this agreement is published as there are no circumstances that outweigh the public interest in publication, and it is in the interest of transparency in the regulatory and disciplinary process.

8. Acting in a way which is inconsistent with this agreement

8.1 The firm agrees that it will not deny the admissions made in this agreement or act in any way which is inconsistent with it.

8.2 If the firm denies the admissions, or acts in a way which is inconsistent with this agreement, the conduct which is subject to this agreement may be considered further by the SRA. That may result in a disciplinary outcome or a referral to the Solicitors Disciplinary Tribunal on the original facts and allegations.

8.3 Acting in a way which is inconsistent with this agreement may also constitute a separate breach of principles 2 and 5 of the Principles and paragraph 3.2 of the Code of Conduct for Firms.

9. Costs

9.1. The firm agrees to pay the costs of the SRA's investigation in the sum of £600.