CRCS Legal July 2024 Newsletter
Barbara Spoor LL.B (Hons)
Managing Director @ CRCS Legal | Complaints and Compliance Handling
Welcome to CRCS Legal July 2024 newsletter.? We hope you have been able to enjoy some of the wonderful good weather we are having.? Here is our round up of interesting compliance articles for July 2024.?
Compensation fund increases confirmed, practising fees to remain unchanged
Law firm and individual contributions toward the SRA Compensation Fund will increase for the first time in five years.
Individual contributions to the compensation fund for 2024/25 will be ￡90 (￡30 last year) while firm contributions will be ￡2,220 (￡660).
The SRA say the fund has come under increasing pressure because of the recent high-profile interventions. This includes an expected ￡35m of claims following the SRA intervention into Axiom Ince and the presumably expensive investigation of the disgraced SSB Law.
Is it fair that profession as a whole is penalised by the mistakes of a few? I think it is totally unfair to expect all of the profession to pay for the downfall of law firms.? The regulator by all accounts ought to have been aware of the issues within Axiom Ince and should have stepped in much sooner.? This may well have prevented the ‘black hole’ that has now opened up.?
We are still awaiting the report from the LSB in respect to how the SRA handled the Axion Ince matter.? We will have to wait and see what the outcome is.?
It is all quiet on the SSB front.? Will the new Labour Government honour Sunak’s pledge to look into the collapse of this law firm?
Post Office Scandal – Inquiry continues – Phase 5/6 2024
Shockingly more than 900 sub-postmasters were wrongfully prosecuted after faulty Fujitsu software incorrectly recorded shortfalls on their branch accounts.? The inquiry continues.
Greg Clark, the former business secretary from 2016 to 2019, told the Post Office Scandal Inquiry that the Post Office brought prosecutions against sub-postmasters in a way that was "corrupt", "unreliable" and "totally unconscionable".
He said, the management culture of the Post Office was "insensitive and dismissive to the point of abject rudeness".
Yet, like the former business secretary Sir Vince Cable, who appeared before the inquiry on the 25 July, Mr Clark said the Post Office had not made him aware of any issues. He agreed with campaigner Sir Alan Bates’ description that Post Office executives were “thugs in suits” and “authoritarian”.
Sir Vince Cable was in charge of the Post Office while in government.
He joined other ministers of the era in their respective evidence by insisting he was guided by departmental officials not to interfere in operational matters at the Post Office.
Stand up and be counted
In our May 2024 Newsletter, we reported that a Norfolk Law Firm was fined almost ￡121,000 for paying out the wrong sums to beneficiaries of an estate and then failing to replace the client money for eight years.
The fine, 3.2% of the firm's turnover, partly reflecting the fact that some of the beneficiaries died before the issue was resolved.
Roger Holden, the Chairman of Hansalls, defended his role in an extraordinary statement given to the Eastern Daily Press, blaming others including more junior members of staff.
It is unclear if the statement was mandated by the Firm.
TA6 Property Information Form Change Outcry
As we previously reported in June. The Law Society released an updated version of the TA6 form in March 2024 to align with new guidance on “material information.”
The Law Society leadership yesterday fought off a vote of no confidence in how it represents conveyancers.
The motion of no confidence in President Nick Emmerson and chief executive Ian Jeffery was brought by the Property Lawyers Action Group (PLAG).
Mr Jeffery acknowledged that “we don’t always get everything right and when we need to correct things, we will do so”.
He continued: “We launched the fifth edition of TA6 too early. We should have communicated more than we did. The strength of feeling has been heard. That has been a learning experience.”
Legal Ombudsman continues to miss targets
The annual report for 2023/24 of the Office for Legal Complaints was published this week and revealed there were 3,376 cases still waiting in the pre-assessment pool.
That figure was a 21% reduction compared to a year before but still well short of the ombudsman’s own target to end the year with a backlog no bigger than around 2,600.
In our experience we are seeing some complaints with a two year delay from the date the complainant contacted LeO , to when they accepted the case for investigation.
LeO found evidence of poor service in 69.4%, and of poor complaints handling in 46%. One-third of complaints related to residential conveyancing, with personal injury (14%) and wills and probate (13%) the next most likely to receive a complaint. A quarter of consumers complained about poor communication, with a similar proportion going to the ombudsman over delays and failure to progress their case.
We can help you with complaint handling.? CRCS Legal have the expertise to handle complaint correctly.? Please contact CRCS Legal to discuss your needs and how we can help.
Firm anti-money laundering and sanctions data requirements
All regulated firms will soon be asked to provide the SRA with information on:
·?????? work they carry out within scope of the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017
·?????? any contact or involvement they have with the sanctions regime and any persons who are designated under it
·?????? submission of suspicious activity reports to the National Crime Agency.
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Here is a link to the specimen questionnaire
The SRA say this questionnaire is provided for information and guidance and all submissions must be made via their online portal.? The SRA will provide a final version when the submission window is open.
The questionnaire must be completed by someone at your firm who holds one or more of the following roles:
·?????? Compliance officer for legal practice
·?????? Authorised signatory
·?????? Money Laundering Compliance Officer
·?????? Money Laundering Reporting Officer.
The SRA say they will accept estimates if exact figures are not available.
The SRA said on the 2 July 2024 that the window for responses will be at the start of August 2024.
Practising certificate and registration renewals
Renewals will take place from 1 to 31 October 2024. This year, there are no new questions in the renewal application. However, the SRA have reworded the continuing competence declaration. They say they have written to your organisational contact or authorised signatory to explain more, and provided information on their website.
Solicitors must declare that as part of the annual practising certificate and registration renewals, that you:
·?????? have up to date understanding of the legal, ethical and regulatory obligations relevant to your role and
·?????? have reflected and addressed any identified learning and development needs and are competent to perform your role.
When making this declaration, you should satisfy yourself that you:
·?????? are acting honestly and with integrity in making the declaration
·?????? have addressed any identified learning and development needs
·?????? are competent in all aspects of your role, not just technical legal practice.
Here is a link to updated guidance from the SRA dated 26 July 2024:? SRA | Understanding your continuing competence requirements | Solicitors Regulation Authority
CRCS Legal Ltd are here to help you manage the ever changing regulatory environment. We provide cost effective, complaint resolutions and compliance solutions.
The risk of non-compliance is real, serious, and costly.? We can provide:
A comprehensive compliance and web-site health check. A thorough look at your policies and procedures with solutions for any non-compliance.
Technical compliance support on an ad hoc or retainer basis. This will give you direct access to compliance professionals.
Complaint handling and assistance with the Legal Ombudsman (LeO) We can investigate the complaints, make recommendations, and draft your complaint response. We have years of experience of dealing with LeO.
Compliance training – one off training courses and comprehensive training programmes.? We can help you comply with the SRA’s continuing competence requirements.
File reviews and audits – detailed and in-depth reviews in accordance with the SRA supervision requirements.
Regulation 21 audits-compliant with Money Laundering Regulations
Bespoke Compliance policies, procedures and templates.?
Assistance with Lexcel accreditation and visits
Anti-Money Laundering (AML) – a review of procedures and policies update
Transparency rules – Are you publishing the correct costs and complaints information?
GDPR and the ICO – including managing data breaches and SARs.
Assistance with SRA investigations and prosecutions
Merger and Acquisitions- assessment of regulatory compliance issues and due diligence.
Take control of your risk and contact CRCS Legal ?today for a free confidential discussion on 03302210511 or [email protected]