Services CLC Compliance Checklist 2026: Key Areas for Conveyancing Firms
For conveyancing firms regulated by the CLC, compliance is not something to revisit only when an inspection is due. It needs to be embedded into everyday practice, shaping how risks are identified and how matters are managed.
This practical compliance checklist highlights the key areas CLC-regulated firms should review regularly, including AML controls, client money handling, supervision, complaints procedures, and staff training. The goal is not simply to tick boxes, but to help firms take a more proactive approach to risk management and maintain high professional standards.
A strong compliance framework protects clients, supports fee earners, and reduces the likelihood of avoidable issues escalating into more serious problems. By reviewing processes regularly and addressing gaps early, firms can build greater confidence across the business and create a stronger foundation for the year ahead.
Checklist Contents
- Start With the CLC Handbook: What Should Every Firm Be Checking?
- Ethical Principles & Culture: Are Your Standards Visible in Practice?
- Client Onboarding & Matter Opening: Do You Truly Know Your Client?
- AML Controls: Are Your Policies Actually Working?
- Accounts & Client Money: Can You Prove Client Funds Are Safe?
- Supervision & File Oversight: Would Your Files Stand up to Scrutiny?
- Complaints Handling: Is Your Process Clear & Fair?
- Equality & Client Care: Are You Meeting Different Client Needs?
- Training & Refresher Plans: Are Your People Up to Date?
- Internal Audits & File Reviews: Can You Spot Issues Before the Regulator Does?
Need Support Strengthening Your CLC Compliance?
Whether you need an independent review of your current processes or ongoing compliance support, PDA Legal can help you identify risks, improve internal controls, and stay inspection-ready throughout 2026 and beyond.
Why This Is the Right Time To Review Your Compliance
For CLC-regulated conveyancing firms, 2026 is a sensible point to pause and review the basics. The CLC’s revised Code of Conduct came into force on 1 January 2025, replacing the previous overarching principles with six Ethical Principles that sit at the heart of the regulatory framework. Therefore, this is a timely moment for firms to check that their procedures still reflect the current rules, rather than relying on outdated templates.
A proper review should cover more than just written policies. Firms should check that processes, systems, training, and supervision are all aligned with the current regulatory position, and that key areas such as client money, AML controls, complaints handling, and management oversight are working in practice, not just on paper. The aim is to reduce risk and make compliance part of everyday business rather than a last-minute exercise.
1. Start With the CLC Handbook: What Should Every Firm Be Checking?
The best place to begin is the CLC Handbook, because effective compliance is built across several linked areas rather than one standalone policy. For conveyancing firms, that means looking beyond a single compliance file and reviewing how the business handles conduct, client money, equality, supervision, and complaints.
Each of these areas plays a part in keeping the firm compliant and supporting stronger client outcomes. Taken together, they show whether compliance is genuinely embedded across the practice or simply sitting in a folder collecting dust.
2. Ethical Principles & Culture: Are Your Standards Visible in Practice?
Compliance begins with behaviour, not paperwork. Firms should be able to show that fee earners and managers work to a culture of integrity, honesty, independence, and openness, while keeping the client’s interests front and centre. This means looking at how decisions are made in practice, not just whether the right policies exist on paper.
The CLC’s updated Code of Conduct is designed to reinforce those expectations and support better client outcomes through clearer professional standards.
3. Client Onboarding & Matter Opening: Do You Truly Know Your Client?
Strong compliance starts at the beginning of the client relationship. Firms should review whether their onboarding procedures go beyond basic ID checks and properly address Customer Due Diligence (CDD), Know Your Customer (KYC) requirements, matter-specific risk assessments, and ongoing monitoring throughout the transaction.
This includes carrying out appropriate source of funds checks on every transaction, alongside source of wealth enquiries where the level of risk or complexity justifies it. Sanctions screening, PEP checks, and Enhanced Due Diligence (EDD) procedures should also form part of the onboarding process where relevant, particularly when dealing with overseas funds or higher-risk jurisdictions.
Matter-based risk assessments should not be treated as a one-off exercise either, as the CLC continues to stress that risks can evolve throughout the life of a transaction.
This remains a major area of focus because conveyancing continues to be viewed as a high-risk sector for money laundering and sanctions evasion. The CLC’s AML guidance, sector risk assessments, and recent Risk Agenda all place significant emphasis on AML controls, sanctions compliance and the quality of client and matter risk assessments.
4. AML Controls: Are Your Policies Actually Working?
This is the point in the checklist where firms should move beyond policy documents and test whether their AML controls are genuinely effective in practice. This means reviewing the firm-wide risk assessment, refresher training records, escalation procedures, file audit trails, and the way suspicions are documented and properly reported.
It is also worth checking whether staff know exactly when to escalate concerns and how to evidence the decisions they have made on a matter-by-matter basis.
The CLC’s AML toolkit and related guidance underline that firms are expected to keep their approach risk-based and up to date, rather than relying on generic templates. The toolkit includes AML guidance and advice, including sanctions-related material updated in July 2025. The CLC also provides resources on breach reporting and suspicious activity reporting, which reinforces the need for clear internal processes rather than a purely theoretical compliance framework.
5. Accounts & Client Money: Can You Prove Client Funds Are Safe?
Firms must look closely at whether their client account controls are genuinely robust in practice. It is not enough to say the bookkeeping is up to date; firms should be able to demonstrate regular reconciliations, clear authorisation controls, proper treatment of residual balances, and a strict separation between client money and office money.
The CLC Accounts Code is a distinct part of the regulatory framework, and the Handbook makes clear that client account arrangements must be handled as a compliance issue, not just an accounting one.
Firms should also check whether fee transfers are properly authorised and whether exceptions are documented clearly, so there is a complete audit trail if the account is ever reviewed. The CLC’s recent Risk Agenda also highlights unreconciled items and aged balances as recurring issues found on inspection, which is a useful reminder that good controls are expected to work in practice, not merely exist on paper.
6. Supervision & File Oversight: Would Your Files Stand up to Scrutiny?
Firms should be able to show that review points, escalation routes, and quality assurance are all built into the way matters are handled, especially on higher-risk files. The CLC’s Management and Supervision Arrangements Code expects firms to have appropriate management and supervision arrangements in place, to supervise and regularly check the quality of work in client matters, and to maintain proper records showing how those arrangements operate in practice.
This makes it important to ask whether partners and managers can evidence active, recorded, and proportionate supervision rather than relying on informal checks or professional experience alone.
A good compliance review should look at whether file reviews are happening consistently, whether risks are escalated promptly, and whether supervision levels match the complexity and risk profile of the work being undertaken. It should also test whether the firm has alternative supervision arrangements in place and whether staff feel able to raise concerns when needed.
7. Complaints Handling: Is Your Process Clear & Fair?
A “good” complaints procedure should be easy for clients to find, straightforward to use, and clear about what happens next. It should set out how complaints are acknowledged, investigated, and resolved within a sensible timeframe, and it should be applied consistently rather than handled differently from case to case.
The CLC’s Complaints Code says the complaints procedure should be “clear, well-publicised, and free”, and the Code of Conduct also expects complaints to be handled impartially and with proper regard to clients’ individual needs.
It is also important that complaints are properly recorded so the firm can identify recurring issues and improve its service. Looking at complaint trends can reveal weaknesses in supervision, communication or file handling long before they become more serious problems. The CLC expects complaints to be dealt with seriously and appropriately, and firms should treat them as a useful source of learning rather than just an administrative burden.
8. Equality & Client Care: Are You Meeting Different Client Needs?
Equality compliance should be part of everyday client care, not treated as a separate box to tick. Under the CLC framework, firms are expected to promote equality of access and service, make reasonable adjustments where needed, and take proper account of clients’ individual needs, including vulnerability.
Firms should also think practically about how this works in real files: are staff aware of when a client may need extra support, are alternative communication methods offered, and are vulnerable clients handled with care and consistency? The CLC’s consumer vulnerability guidance is a useful reminder that inclusion and accessibility are part of delivering safe and effective legal services, not an optional extra.
9. Training & Refresher Plans: Are Your People Up to Date?
A compliance checklist is only useful if it leads to action. Even well-written policies can quickly become ineffective if staff are not properly trained on how to apply those procedures in practice. Firms should regularly review whether employees are receiving the right level of training for their role, alongside annual refreshers that keep knowledge current as regulations and risks evolve.
This should include role-specific AML training, supervision and management training for partners and senior staff, and refresher sessions that reflect the firm’s actual risk profile. It is also important to document attendance, competence, and follow-up actions, so the firm can demonstrate that training has been completed and understood if questioned by the regulator.
This is an area where many firms benefit from external support. PDA Legal provides compliance training tailored to regulated law firms, helping practices strengthen staff awareness, address knowledge gaps, and build a more consistent approach to compliance across the business.
10. Internal Audits & File Reviews: Can You Spot Issues Before the Regulator Does?
Regular audits and file reviews allow firms to identify weaknesses before they develop into larger compliance problems. Rather than waiting for issues to surface during an inspection or complaint, firms should carry out periodic reviews of client matters, AML procedures, and operational controls to assess whether policies are being followed consistently in practice.
Sample file reviews can help uncover recurring issues such as incomplete risk assessments, weak source of funds evidence, gaps in supervision records, or inconsistent client care. Audits also make it easier to identify broader trends across the business, including process weaknesses and areas where additional oversight may be required.
Like staff training, this is often where external support can add real value. PDA Legal offers dedicated AML audit and file review services for regulated law firms, helping practices assess the effectiveness of their compliance arrangements and implement practical improvements before concerns escalate further.
Spot the Gaps Before the CLC Does
Keeping up with CLC compliance requirements can place significant pressure on conveyancing firms, particularly when regulatory expectations continue to evolve across AML, supervision, client money handling and staff training. However, taking a proactive approach to compliance can give firms greater confidence that their procedures will stand up to scrutiny when needed.
Whether your firm needs help reviewing AML controls, improving supervision arrangements, delivering refresher training, or identifying gaps in existing procedures, PDA Legal can provide a clearer and more objective view of where improvements may be needed.
To discuss how PDA Legal can support your firm’s compliance requirements, get in touch with us today.
Neil Partridge is Operations Director and a risk and compliance specialist with nearly two decades of experience in the legal sector. He is a senior trainer, AML lead auditor, and Lexcel assessor, delivering consultancy, assessment, and training to law firms across the UK on compliance, risk, and best practice.
