The Solicitors Regulation Authority has re-opened discussions with the Ministry of Justice on raising the amount it can fine firms from the current maximum of £2,000.
Last year the MoJ rejected a request to bring the maximum penalty for traditional firms into line with the £250m set for alternative business structures.
A consultation published last week on proposed guidance for setting financial penalties reveals that the regulator has 'made a separate proposal that the maximum sum which the SRA can fine traditional law firms and those involved in traditional law firms should be significantly increased'.
It goes on to say that the SRA is currently discussing what increases, if any, could be made in the short- to medium-term to the SRA's fining powers under the 'traditional' regime and the possible need for changes to primary legislation to achieve 'longer-term reform'.
The SRA consultation paper itself seeks views on proposed guidance on the fines it can levy against firms and individuals that have breached the code of conduct, in order to make the criteria more 'consistent and transparent'.
It suggests a three-step approach that looks at the seriousness of the conduct, mitigating factors and whether the penalty will remove profit arising from the conduct.
Assessing the seriousness of the conduct would involve looking at both the nature of the conduct and harm caused to clients or others, after which the decision-maker would be guided to 'penalty brackets' within which to levy a fine.