Happy Friday and welcome to our Back to School edition.
We hope you enjoyed your summer break and are relaxed and energised enough to get back to it. There’s actually been plenty going on over the summer break – clearly nobody told the SRA the profession was Gone Fishing…
Should you have any comments, queries or comments then please do get in touch, we love hearing from you.
Jon and the team
Preparing for SRA price transparency
Unless you have been living on a dessert island (in which case lucky you) you will have heard about the SRA’s plans to require firms to publicise their prices. The requirements will come into force on 1st December 2018 – less than 12 weeks to go.
There is a lot of anxiety and confusion about how firms should prepare. The SRA has promised more guidance, and we will of course keep you informed. In the meantime, our latest blog pulls together what know so far so you can at least begin preparing.
SRA Risk Outlook 2018/2019
Not sure where to start with all the compliance risks facing your firm? The SRA does a lot of work analysing the most pressing risks to the profession, and for our second blog this month we look at the latest SRA Risk Outlook – probably a very good place to start!
Yes, they do use the Risk Outlook to justify their own policy decisions (cough – price transparency), but notwithstanding that, there are some useful pointers on where your COLP’s attention should be.
LSB needs more time to consider SRA’s plans
The SRA’s application to the LSB received a step back this week when the LSB confirmed it needed additional time to decide given the substance of the application.
The application included approval of its new code of conduct and simplified accounts rules. Probably the most controversial part of the application however, and one fiercely opposed by the Law Society as well as a number of practitioners, is the intention for solicitors to practise as solicitors outside of regulated entities.
Why it matters
Allowing solicitors to do work for the public outside regulated entities (i.e. law firms) has the potential to completely change the legal landscape. The Law Society’s concerns include that it causes confusion to clients and reduces protections such as PII and access to compensation funds.
The SRA is adamant that it will increase competition and allow solicitors to become innovative.
We agree that it is important that the profession is full of healthy competitive. But not at any cost. The very real risk of a confusing two-tier profession is too much of a gamble, and putting the genie back in the bottle would be problematic, to say the least.
The SRA has its own ‘regulatory sandbox’ where innovative ideas can be fully tested before releasing them upon the public. Why not start there?
Warning Notice 1: client accounts used as a banking facility
This is an updated and reissued warning notice from 2014. It remains critically important, and yet a common area of poor practice.
The basic principle is that solicitors must fiercely protect their client account, and must not allow it to be used in circumstances other than for an underlying legal matter.
There are good reasons for this rule. Not least that client account transactions are attractive to people seeking to hide their assets – money launderers or those seeking to avoid the liquidator’s clutches.
Why it matters
This is a clear-cut rule, but despite the various disciplinary prosecutions it has spawned, some still do not abide by it. Perhaps the client is disproportionately valuable to the firm and holds too much power over their lawyers. Maybe there is a lack of training and awareness throughout the firm.
Do make sure that your people are aware of this compliance issue, and that there are systems in place to guard against the risk. For example, a requirement for all client account requests to include a full description of the reasons behind the transaction could both help the accounts team to spot issues, and make the fee earner think twice about using the client account inappropriately.
Warning Notice 2: holiday sickness claims
This is another updated and reissued warning notice. It’s almost as if they are not being read first time around.
Holiday sickness claims have, unfortunately, been plagued by poor practice and – if the tour operators are to be believed – fraud. (There’s no reason to think they might be overstating the case, of course!). The SRA clearly feels that it is such a problem that they must intervene. Of particular concern to the regulator are reports of:
- dodgy referral arrangements
- claims farming in resort
- encouraging un-meritorious and fraudulent claims
- practitioners ‘dabbling’ in an area they have little experience in
- poor client service
Why it matters
We all know that governments and regulators are hostile to personal injury claims generally, so it is no surprise to see the SRA clamping down on this area of practice which has attracted some poor practitioners.
That is not to say that firms should not take on these cases – it would be a serious access to justice issue if we all got scared off. But solicitors must ensure that their files are run well, that all referrers are squeaky clean and that compliance is evidenced.
New and updated Law Society Practice Notes
New and updated SRA Warning Notices, Guidance and Consultations
- SRA consultation on Reporting concerns, deadline for response is 27th September 2018
- Updated Payment Protection Insurance (PPI): Warning notice
- Updated Improper use of client account as banking facility: Warning notice
- Updated Holiday sickness claims: Warning Notice
- Former Senior Crown Prosecutor with the CPS, Eoin McCarthy, was struck off the roll following a conviction of fraud. He had submitted claims for travelling expenses for a series of journeys that he had not undertaken.
- Deborah Daniels, a Solicitor with over 30 years PQE was suspended for 18 months and following multiple tweets expressing hostility towards or a hatred of religious groups. Her Twitter profile page clearly identified her as a solicitor.
- Gavin Dowell, a solicitor with over 27 years PQE was struck-off the roll following a conviction for grievous bodily harm for head-butting a fellow coach during a children’s rugby match. Mr Dowell had failed to advise the SRA of his conviction.
- Rebecca Harling was suspended for 15 months following a conviction for assault occasioning actual bodily harm. She had visited her former boyfriend who reacted badly to her presence and pushed her to the ground. She was helped to her feet and went to get a glass of water and her former boyfriend said she should have asked his permission. She reacted by striking him in the face with the glass she was holding.
- Shohabb Dar, a sole director of Glad Law Limited which closed in December 2014, was rebuked by the SRA for failing to submit accountants reports for three years and also failing to submit a cease to hold report for the period to 11 December 2014.
- Sole practitioner Ansar Khan was given a written rebuke and ordered to pay the SRA’s costs of £600 following a conviction of two harassment offences relating to conduct outside of his professional practice.