- Publication Date
- 2024-02-02
The Solicitors Regulation Authority (SRA) undertook an audit of a law firm. The outcome of the audit led to several findings and actions. The law firm had received multiple Qualified Accountant’s Reports (QARs) for periods ending in May 2021 and May 2022. These reports highlighted that the firm held numerous client balances with no movement for twelve months. As of February 2023, the firm held 393 client balances totaling £596,706.79, with individual amounts ranging significantly. These issues arose partly due to the firm focusing on current client matters at the expense of historic ones.
The SRA found that the firm failed to return funds to clients promptly after their matters concluded and did not address the high volume of residual client balances upon receiving the first QAR in June 2021. Furthermore, the firm did not sufficiently notify clients of money owed to them when their matters were concluded. These conduct issues spanned a time frame from 1995 to 2023.
In response to these findings, the firm accepted responsibility and put forward mitigation efforts, which included implementing new policies and procedures to prevent future breaches. The SRA determined a fine was necessary due to the pattern of misconduct. The amount was calculated based on the severity and impact of the breaches. As the breach formed a sustained misconduct pattern, the resolution involved agreeing on a financial penalty.
The SRA concluded their oversight by ensuring that the firm committed to ongoing compliance improvements, thus mitigating further risks to client funds handling.
(Note: All personal details and specific legal references have been omitted as requested, along with dates generalized to month and year.)