Your monthly round-up of compliance developments, sector insights and HiveRisk updates.
Welcome to the first edition of the newly revamped HiveWire, designed to bring you sharper insights, clearer takeaways, and practical steps to support your firm’s risk and compliance obligations.
HiveRisk News
Autumn 2025 has been a busy season at HiveRisk HQ. We’re delighted to welcome two new members to our technical team:
- Eloise Butterworth, Head of Risk & Compliance
- Liam McIntosh, Compliance Associate
Both bring deep sector expertise and have already hit the ground running. We’re thrilled to have them on board as we continue strengthening our support for clients.
COMPLIANCE UPDATES
1. FCA to Take Over AML Supervision of the Legal Sector
On 21 October 2025, the UK Government confirmed its intention to transfer AML supervisory responsibility from the legal regulators and professional services business (including the SRA) to the Financial Conduct Authority.
This follows strong opposition from the profession during the 2023 consultation, but change is now firmly on the horizon.
What to expect:
- Transition will take time, as new legislation is required.
- The FCA’s approach is more data-driven and outcome-focused than the SRA’s.
- Expect higher expectations around evidencing the effectiveness of your PCPs.
Further insight: Watch our OnDemand webinar for practical preparation steps.
Take our FCA readiness assessment here.
2. Mazur Judgment – Ongoing Impact
The judgment in Julia Mazur & anor v Charles Russell Speechlys LLP [2025] EWHC 2341 (KB), released on 16 September, has sparked widespread sector discussion. The application to appeal has now been allowed but may not be heard until February 2027.
While non-authorised staff may support litigation, they must not conduct it, and firms must carefully assess supervision, responsibility, and decision-making in practice. There is no bright-line test, so substance over form applies, and firms are expected to review authorisation scopes, supervision arrangements, and record their decision-making. Regulators have signalled support for firms acting in good faith, but enforcement action may follow where risks are not addressed.
Key considerations for firms:
- Do not confuse unauthorised with unqualified. Identify any unauthorised individuals in affected departments.
- Previous regulatory guidance may offer a defence for historic issues but will not protect you going forward.
- Unauthorised conduct remains a criminal offence for both firms and individuals.
- Firms should urgently review policies, procedures, supervision frameworks and training.
- A full internal investigation into exposure is advisable.
- Consider whether a self report is required
If you need a detailed action plan, our team can support you.
3. SRA Thematic Reviews
2025 Thematic Review: Source of Funds
The SRA’s latest thematic review highlights several recurring failings:
- Evidence collected but not assessed
- Poor record-keeping and insufficient rationale
- Client ledgers not supported by documentation
A full copy of the findings is available online.
If you are unsure whether your approach meets expectations, we can assist with updated training or a diagnostic review.
2026 Thematic Review Focus: AML PCP Effectiveness
Next year’s thematic review will assess effectiveness, not document existence. Firms must be able to show that their controls are working in practice.
4. FATF Updates – October Plenary
The FATF has confirmed the following changes to its country lists:
Countries removed from the grey list:
- Burkina Faso
- Mozambique
- Nigeria
- South Africa
No countries were added to either list.
Actions for firms:
- Assess whether any clients or matters are affected and document your assessment.
- Update your FWRA, HRTC lists and internal materials.
- Communicate changes clearly to staff.
- Review whether you could quickly identify affected clients if new countries were added.
If your current systems don’t allow easy identification, we can assist in designing proportionate processes.
5. EU AI Act – Preparing for a New Regulatory Era
Only 30% of firms feel confident in their AI readiness, yet adoption of AI tools has grown rapidly.
The EU AI Act:
- Is the world’s first comprehensive AI regulation
- Has extraterritorial reach (similar to GDPR)
- Applies to any provider or deployer of AI whose outputs are used in the EU
For law firms, this presents both a risk and an opportunity.
Firms should begin:
- Mapping AI systems used or provided
- Classifying systems by risk tier
- Implementing governance and monitoring
- Training staff
- Reviewing controls regularly
Our CEO, Kate Burt, has delivered Law Society classroom sessions on this topic, and we offer bespoke consultancy support.
UPCOMING EVENTS & WEBINARS
‘What’s the Buzz’ Free Webinars – Free to Register
18 November 2025 – FCA transition watch OnDemand recording now
16 December 2025 – Law Firms, Data and AI
19 December 2025 – ‘Off the Record’ interactive workshop re FCA AML supervision Consultation
29 January 2026 – Source of Funds in Focus
In Person Events HiveRisk are Supporting in 2026
- 9 January 2026 – Courtside Conversations Padel Tournament, Dubai
- 24 February 2026 – The Legal Heart Conference, Manchester
- 5–8 May 2026 – The Lawyers Retreat, Calo Carbo, Ibiza
- 3 July 2026 – The Great Big Legal Office (GBLO)
Final Thoughts
2025 has been a year of significant regulatory and technological change. HiveRisk is here to help you turn complexity into clarity and stay ahead of emerging obligations.
If any topic in this edition raises questions or you’d like tailored advice, please get in touch.
We are now booking in AML audits for the New Year, get in touch to secure yours today.