LSB acts against SRA over Axiom Ince
Britain’s main legal-services regulator has taken action against the Solicitors Regulation Authority (SRA) for its handling of an investigation into Axiom Ince.
The Legal Services Board (LSB) said that its “binding directions” were aimed at avoiding a repeat of the regulatory failures identified in a report on the issue published last year.
Axiom Ince stopped trading in October 2023, leaving around Stg £60 million in client money missing and leading to the loss of around 1,400 jobs.
Corporate-structure risks
The LSB has now acted using its statutory powers under Britain’s Legal Services Act.
It told the SRA to:
- Improve how it identifies risks to consumers and be more proactive in responding to them. This includes risks arising from the corporate structure of law firms and from sales, mergers, and acquisitions,
- Strengthen the regulation of client money and ensure that firms have effective safeguards in place, and
- Strengthen controls to protect the public interest and consumer interest where there is a concentration of ownership, compliance, and management roles in one person.
Axiom Ince’s owner had held multiple key compliance roles – including being the compliance officer for legal practice, for finance and administration, and for money-laundering.
Written report
LSB interim chair Catherine Brown said that the directions were designed to protect the public and better ensure that client funds were properly safeguarded.
“Over the last few months, the SRA has already started making the necessary changes to rebuild public trust and confidence in the regulatory framework that protects people who need legal services,” she added.
The SRA must comply with the LSB’s directions within 12 months and provide a written report to the LSB on progress every three months.