Risk Management

Risk Awareness and Management – supporting you through our Risk Management Library

We all face risks in our daily lives and managing them often becomes second nature, whether it’s wearing a seatbelt, taking out insurance, or protecting our bank details. In our professional lives, however, risks can be more complex and less visible, making awareness and proactive management essential.

At CILEx Regulation, we believe that sharing information about risks, and how to mitigate them, is more important than ever, especially given the evolving threats faced across the legal services sector.

The Risk Management Library – what it offers

Our Risk Management Library is designed to support our entire regulated community, regardless of your role or the organisation you work in. It provides practical insights and resources to help you:

Identify common risks encountered in day-to-day legal practice
Understand the benefits of implementing policies and procedures to manage those risks
Access additional support and guidance from CILEx Regulation and trusted external sources.

Additional Resources

Alongside our own materials, we’ve published guidance and papers from other organisations that offer valuable perspectives and tools to help you manage risk effectively.

Whether you’re a sole practitioner, part of a larger firm, or working in-house, the Risk Management Library is here to help you build a safer, more resilient practice.

Financial Crime risks – what you need to know

The UK Government continues to place strong emphasis on tackling money laundering, disrupting organised crime, and preventing the financing of terrorism. Legal professionals are seen as potential targets due to the perceived legitimacy their services offer, making this a critical risk area for the sector.

Why it matters

The legal sector is highlighted in the 2025 National Risk Assessment (NRA) as being vulnerable to money laundering through:

Conveyancing and property transactions
Trust and company formation
Misuse of client accounts
High-value transactions involving opaque ownership structures.

The 2024-25 HM Treasury AML/CTF Supervision Report reinforces the importance of effective risk-based supervision, compliance monitoring and enforcement activity across regulated sectors. The report also outlines the Government’s plans to reform AML supervision and prepare for the UK’s next FATF Mutual Evaluation.

While money laundering remains a significant risk, firms should also be aware of wider economic crime threats. Emerging risks may arise from fraud, sanctions evasion, bribery and corruption, terrorist financing and other forms of economic crime. Firms should ensure that their risk assessments, policies and controls remain proportionate to the services they provide, the clients they act for and the risks they encounter.

What you should do

To help combat this risk, CILEx Regulation provides dedicated guidance and resources on our Anti-Money Laundering webpage. We encourage all firms and individuals to:

Update your risk register and Practice-Wide Risk Assessment (PWRA) to reflect current money laundering, terrorist financing and sanctions risks.
Reflect the findings of the 2025 National Risk Assessment and the 2024-25 HM Treasury AML/CTF Supervision Report.
Review your policies, controls and procedures to ensure they remain proportionate, effective and aligned with current regulatory expectations.
Ensure sanctions risks are appropriately considered within firm-wide risk assessments and client due diligence processes.
Review ownership and control risks, particularly where clients, counterparties or transactions involve complex corporate structures or opaque ownership arrangements.
Stay informed about emerging threats, including the use of cryptoassets, technology-enabled financial crime, sanctions evasion and complex ownership structures.

Our approach to managing risk when authorising Entities

CILEx Regulation takes a risk-based approach to authorising and supervising entities. This ensures that only those organisations which meet our standards and demonstrate a commitment to compliance are approved for regulation.

We have published a series of documents that outline:

How we assess applications for authorisation, including licensing
The risk factors we consider during desk-based authorisation and ongoing supervision
The types of entities we believe are suitable for regulation by CILEx Regulation

These documents are designed to provide transparency and clarity for applicants and regulated firms.