Tribunal approves agreed outcome after regulator identified failures in systems and controls over handling of client money
A London law firm and two of its partners have been fined after the Solicitors Disciplinary Tribunal (SDT) approved disciplinary findings relating to the improper retention of client account funds following a commercial property transaction.
The case concerned YVA Solicitors LLP and its partners Christopher Yiannakas and Nicholas George Kephalas, whose conduct was investigated by the Solicitors Regulation Authority (SRA).
The tribunal approved an agreed outcome between the regulator and the respondents shortly before the matter was due to be heard in February 2026. The case was therefore determined on the papers without a contested hearing.
The SDT found that proceeds from a commercial property sale remained in the firm’s client account after there was no longer a proper reason to retain those funds in connection with the underlying transaction. During that period, seven payments were made from the retained monies that were not related to the delivery of regulated legal services.
Mr Yiannakas served as both Compliance Officer for Legal Practice and Compliance Officer for Finance and Administration between August 2021 and September 2022. In that capacity, the tribunal found that he failed to take appropriate remedial action once the firm no longer had a proper basis for holding the funds in its client account.
Mr Kephalas acted on the relevant client matter and also assisted in an unofficial compliance role during the same period. The tribunal found that he retained part of the proceeds of the property transaction in the client account without a proper reason to do so.
The tribunal also considered allegations concerning a payment of £355,000 connected with a refinancing matter. However, those allegations were withdrawn following clarification between the parties before the final determination. Several other allegations originally advanced by the regulator were similarly withdrawn.
The remaining allegations were admitted by the respondents and proved on the balance of probabilities through a statement of agreed facts and outcome submitted jointly to the tribunal.
Regulatory concerns first arose after the submission of a qualified accountant’s report covering the period from April 2021 to March 2022. That report identified breaches of the SRA Accounts Rules 2019 linked to the handling of client money in connection with the commercial property transaction. The SRA subsequently carried out a forensic investigation in January 2023 and later produced a report addressing those issues.
The tribunal further found that the firm failed to ensure that effective systems and controls were in place to manage risks associated with the handling of client funds.
Following approval of the agreed outcome, the SDT ordered Mr Yiannakas to pay a fine of £500 and Mr Kephalas to pay a fine of £500. The tribunal also ordered YVA Solicitors LLP to pay a fine of £2,500.
In addition to those penalties, the tribunal ordered the firm to pay costs of £35,000 arising from the regulator’s investigation and proceedings.