A law firm partner is facing an £85,000 bill for failing to carry out even an internet search to check the background of his clients following a disciplinary hearing centring around the huge data leak from former Panamanian law firm Mossack Fonseca.
Khalid Mohammed Sharif, partner at Belgravia firm Child & Child, has been fined £45,000 by the Solicitors Disciplinary Tribunal. Costs of £40,000 were also imposed.
According to the SDT decision, Sharif’s failings had 'led to a risk of large amounts of money being laundered’ and his culpability was high. However, the tribunal noted that he co-operated with the investigation and had voluntarily reported himself to the Solicitors Regulation Authority.
Sharif’s clients were not identified in the ruling but have been reported to be two daughters of a central Asian head of state. The women set up a British Virgin Islands-incorporated company to help manage two properties in Knightsbridge, London. The properties were worth nearly £60m.
Details of the offshore company emerged in April 2016 following the Panama Papers leak. Child & Child had instructed Mossack Fonseca to incorporate the company.
Sharif claimed that the two women had no political connections. But, according to the published outcome, Sharif admitted that he failed to take adequate steps to check this, when even an internet search might have identified them as politically exposed persons.
The solicitor, admitted in 2005, also admitted to not undertaking enhanced customer due diligence even though he had not met the clients. Sharif was the firm’s money laundering reporting officer (MLRO).
‘The respondent was wholly culpable for his misconduct. Further, he was the MLRO at the firm. This should have heightened his sense of his obligations, and his awareness of the risks,’ the judgment said.
*Correction: Our news item above initially stated that failings by the respondent, Khalid Mohammed Sharif, led to 'a large amount of money being laundered'. This was incorrect. The SDT's judgment in fact stated that 'the respondent's failings had led to a risk of large amounts of money being laundered’. We apologise for the error.