Law and Lawyers Limited; Francis Mathew

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

Law and Lawyers Limited and its director Francis Mathew admitted multiple breaches of the SRA Accounts Rules 2019, Principles and Codes of Conduct, including a client account shortfall of £40,636.08 across 423 matters, failure to conduct compliant reconciliations, retention of £287,821.46 residual client balances, inadequate source of funds checks, and failure to have a firm wide anti-money laundering risk assessment. The Second Respondent, as COFA/MLCO, failed to remedy or report breaches and recklessly provided an inaccurate declaration to the SRA that a firm wide risk assessment existed. The Tribunal found all allegations proved and recklessness proved, but made no finding of dishonesty (indeed expressly noting no lack of integrity). Culpability was assessed as high and misconduct very serious (Level 4). Each Respondent was fined £25,000, the Second Respondent was made subject to an indefinite Restriction Order barring senior compliance roles without SRA permission, and both were ordered to pay £38,000 plus VAT costs jointly and severally.

Duties found breached:

• Handle inadvertently received material
• Accounting records, reconciliation and reports
• Account for interest on client money
• Firm governance, systems and compliance
• Good faith and courtesy to colleagues

Aggravating factors:

• Recklessness found in relation to the inaccurate declaration to the SRA (Allegation 2.3)
• Second Respondent aware of practices akin to taking money from one client to pay another yet allowed them to continue
• Failure to comply with fundamental regulatory requirements where directly responsible for compliance as COLP/COFA/MLRO/MLCO
• Cavalier attitude to regulatory obligations; high culpability
• Persistent and long-running breaches heightening risk given firm's substantial conveyancing work

Mitigating factors:

• No previous disciplinary or regulatory findings
• Open and frank admissions and full cooperation with the SRA
• Genuine insight and remorse
• Substantial remedial action taken after investigation (firm wide risk assessment, replaced compliance officers, daily reconciliations, replaced shortfall, cleared balances, AML training)
• No evidence of loss to clients or claims on Compensation Fund; harm reputational
• Strong personal mitigation and character references (community service, charitable donations, kidney donation)
• Misconduct not planned or deliberate; arose during workload spike (SDLT holiday) and COVID staffing pressures