Practice and Procedure

Majority will avoid sanctions on compliance

PUBLISHED April 26, 2013

Monday 29 April 2013 by John Hyde

Only a small minority of the 928 people or firms being investigated over compliance officer nominations will face sanctions, the Solicitors Regulation Authority revealed last week.

Enforcement action is under way against those who either failed to nominate COLPs and COFAs before the deadline or where their nominations raised concerns.

Of those, 21 are considered serious enough for the SRA to commission a 'forensic investigation' that could lead to closure of the firm and potential referral to the Solicitors Disciplinary Tribunal.

Chief executive Antony Townsend told last week's board meeting that most other investigations will end with no action taken. 'We're very concerned to be helping firms to improve and get structures in place. We're not there to wield a big stick,' he said.

The SRA has revealed that more than 500 enforcement matters relate to non-disclosure issues, with a further 300 concerning firms that responded late during the nomination process.

Among the most serious failures to nominate, explanations included having to care for elderly relatives, being out of the country for a significant period, not bothering to read emails from the SRA and partners unable to decide whom to nominate.

According to SRA ethnicity records, of the 908 firms still open that were subject to enforcement action, 64% were majority white and 20% majority BME.

There were 364 firms with two to four partners subject to enforcement action, with 326 sole practitioners also investigated. Nomination failings were uncovered at 25 firms with at least 11 partners.

On 1 March, a dedicated enforcement team was put in place to deal with action resulting from the requirement to nominate compliance officers.