Dentons UK and Middle East LLP

Findings — machine-extracted (anthropic-batch:claude-opus-4-8); verify against the decision

Dentons UK and Middle East LLP was alleged to have failed to take adequate measures to establish the source of wealth/funds of Client A, a high-risk politically exposed person from a corruption-prone jurisdiction who was later convicted of fraud and embezzlement. The SDT found the Firm did breach Regulation 14 of the MLRs 2007, primarily because the relationship partner (Mr Chateau, a New York-based non-SRA-regulated lawyer) had not asked appropriate questions to establish source of wealth, and this failure endured across the retainer. However, the Tribunal held the breach was inadvertent, non-systemic and did not cross the threshold of seriousness/culpability to breach Principles 6, 7 or 8 or Outcome 7.5. With no finding of professional misconduct engaging its jurisdiction, the Tribunal dismissed the allegations and made no order as to costs. No dishonesty was alleged or found. (The decision was later appealed and quashed/remitted by the High Court and Court of Appeal.)

Duties found breached:

• Not misrepresent regulated status

Aggravating factors:

• Breach endured throughout the retainer (approx. May 2013 to January 2017)
• Client A was a PEP from a high-risk jurisdiction known for corruption
• Firm continued acting notwithstanding the KCS Report urging 'extreme caution' and General Counsel's misgivings

Mitigating factors:

• Breach was entirely inadvertent, not systemic
• Firm's AML systems and controls had been commended by the SRA as 'gold standard'
• Firm relied in good faith on the knowledge/assertions of client relationship partner Mr Chateau
• Contemporaneous guidance (Law Society Practice Notes, AML Toolkit) did not require documentary evidence of source of wealth/funds
• Single client involved out of many high-risk clients onboarded