The Law Society of England and Wales have expressed their concern regarding the idea that the Solicitors Regulation Authority (SRA) are considering a one-off levy on the profession to cover the likely shortfall in the Solicitors Compensation Fund.
This shortfall has come off the back of the significant losses from the Axiom Ince, Metamorph and Kingly collapses.
Ian Jeffery, Chief Executive Officer for the Law Society of England and Wales, said:
“As the representative body for the solicitor profession, we are of course greatly concerned that our members could be asked to plug a gap of many millions of pounds in the Compensation Fund arising from the collapse of just three law firms, which were set up under atypical business models and with their own clear and inherent risks.
We would expect the solicitor profession to be consulted before any decision is made by the SRA on its approach to these exceptional compensation questions, given that our members would be required to pay for it and it is their collective reputation at stake.
As a representative body we recognise that regulatory decisions are by law a matter for the SRA, but we have a role to be assured that the SRA complies with its statutory duty and the regulatory principles guiding any regulatory action which must be transparent, accountable, proportionate, consistent and targeted.
We will work with the SRA and, as appropriate, the Legal Services Board, to ensure that events are fully investigated and that all proper assurance is provided.”