Supervision Pilot shows positive results for the Solicitors Regulation Authority
SRA calls for power to impose automatic fines on non-compliant firms
Results of the Solicitors Regulation Authority's supervision pilot focusing on over 100 firms of varying size across the country has shown overwhelmingly positive feedback from the profession, according to areport just published by the SRA.
The pilot was carried out from January to September last year with what the SRA classifies as 'medium to low' impact firms under the authority's new outcomes-focused approach to regulation involving a more active engagement with firms.
The aim was to test, define and develop the new approach to particular themes and events using two different methods - desk-based, and visit-based supervision - or a combination of the two. The approach selected depended on the SRA's assessment of risk the firm posed, its management of risk, its size, and its approach to, and history of compliance.
Within the pilot sample, supervisors within the SRA's taskforce identified and categorised six key risk areas affecting the firms:
- Operational risks - 46%
- Instability/financial failure - 25.2%
- Competency, fitness and propriety - 12.4%
- Fraud/dishonesty affecting - 8.9%
- External perception - 4.5%
- Market risks - 3% In the majority of firms, risk levels were shown to decrease during the period of the supervision pilot.
Meanwhile, The Law Society's Gazette reports that the SRA is calling on the government for permission to impose automatic fines for firms that fail to comply with regulatory deadlines. Such a power would require secondary legislation.
The Gazette reports that hundreds of firms are thought to have failed to submit nominations for compliance officers. The deadline was 31 July. The new compliance officers are expected to begin their roles on 1 January. The report can be read here.