A firm and its owner have each been fined after admitting they failed to carry out proper checks on two property transactions.
South London firm Topstone Solicitors Limited and director Silas Ogbonna were sanctioned following a regulatory settlement agreement with the SRA which was approved by the Solicitors Disciplinary Tribunal.
The tribunal found that Ogbonna admitted failing to conduct adequate due diligence on the two transactions between August 2018 and January 2019. He also failed to identify one client as a politically exposed person, as defined by money laundering regulations, and failed to cause his firm to do the required checks.
The tribunal heard that the solicitor, admitted to the roll in 2009, had proposed a fee of £2,340 for each transaction but he was supposed to verify the identities of clients and parties making paying into the firm’s client account, as well as the sources of funds received. Failing to do so gave rise to a risk of money laundering.
Ogbonna accepted that in the course of a digital due diligence check, he used a ‘manual override’ facility to add commentary, which resulted in a previously non-compliant check showing up as compliant. On both transactions, source of funds checks were indicated but were not adequately carried out in respect of funds received into the client account.
In September 2018, after one transaction was aborted, Ogbonna also caused or allowed a £37,865 payment to be made from the firm’s client account and in doing so provided a banking facility.
In mitigation, Ogbonna and the firm said that on one transaction, the client had been recommended by a trusted agent through whom no previous issues had arisen. He spoke with the client and took ID but was not alive to the risk she could be a politically exposed person. On the second transaction, oral instructions were taken about the source of funds, but it was accepted these were inadequate.
As well as being fined £12,500, Ogbonna will be subject to conditions preventing him from being a compliance officer for two years. The firm was fined £15,000. They will jointly pay £10,000 costs.