Backing for tougher client-money framework
The Law Society of England and Wales said this morning it is supportive of the Solicitors Regulation Authority (SRA) strengthening consumer protection and improving the robustness of the client money framework.
Since July 2024, the SRA in Britain has been consulting on ways to reduce risks to client money and ensure clients are protected when using regulated law firms, to help maintain public confidence and trust in legal services.
The recent consultation seeks feedback on improving the accountants’ reports regime and strengthening checks and balances provided by compliance officers in law firms.
The Law Society’s response to the SRA consultation highlights:
- Broad support on improving the accountants’ reporting regime and the enhanced support package for compliance officers, recognising the value this could bring in improving standards,
- Objections to the proposed separation of compliance roles.
However, there are concerns about the use of fixed financial penalties, which may create unintended risk or delay and could unfairly penalise firms for failures outside their control.
Robustness
Law Society vice president Brett Dixon said: “We support the SRA’s ambition to strengthen consumer protection and enhance the robustness of the client money framework.
“Restoring the historical safeguard that requires firms holding client money to submit annual accountants’ reports to the regulator is a sensible and necessary measure.”