A Labour MP says the High Court decision limiting the SRA's access to privileged files could hobble anti-money-laundering supervision when the FCA takes over.
Members of Parliament have called on the UK government to legislate so that the High Court's ruling in the Carter-Ruck case does not stop regulators investigating money laundering, Legal Futures reported on Thursday, 12 November.
The ruling, handed down in September, held that the Solicitors Regulation Authority cannot require a law firm to produce privileged documents unless the client waives privilege. Labour MP Phil Brickell, who chairs the all-party parliamentary group on anti-corruption and responsible tax, called it a significant problem. He warned that without action, misconduct by solicitors involved in money laundering or abusive litigation could stay beyond effective scrutiny.
Brickell was speaking at the second reading of the Financial Services and Markets Bill, which would move anti-money-laundering supervision of lawyers, accountants and trust and company service providers from 22 professional bodies to the Financial Conduct Authority. He backed the transfer, saying split supervision creates conflicts of interest and uneven enforcement. The bill has already passed the House of Lords, where the government said the transition would begin in 2028, and where ministers confirmed that the FCA will not have powers to compel the disclosure of privileged material. Brickell said the Carter-Ruck litigation should prompt a rethink.
