The SRA has issued some guidance on the situation when a client has approached a firm asking them to hold monies on their behalf, but the firm does not wish to do so.
First of all it is worth pointing out that it is up to the firm to decide whether it has a Client Account. It is also for the firm to decide if it will accept the money. However, there are several factors that might influence that decision.
Here is a link to the reply to the FAQ that the SRA has produced. Go to number 12.
https://www.sra.org.uk/solicitors/guidance/operate-client-account/#collapse_6a1d
Also the SRA has provided more case studies to help law firms avoid providing Banking Facilities. Here is the link.
https://www.sra.org.uk/solicitors/guidance/improper-use-client-account-banking-facility/
Help with SRA Accounts Rules Compliance
We have a team of experts in the SRA Accounts Rules. Please feel free to reach out for advice. They can also provide training for the COFA & COLP and the accounts team. In addition they can also assist with a review of the firm's finances, benchmarking against other law firms (as they are involved in one of the major annual benchmarking exercises for the Legal sector), cashflow forecasting and work on improvement of profitability. We can also assist should there be an SRA inspection or investigation. (The same applies for CLC regulated firms.)
For help, fill in the form below or contact our lead consultant, Ingemar Hunnings: [email protected]
These changes will come into effect on 1st April 2023. In summary:
1 – A change to time limits for referring a complaint to the LEO (reduced to 1 year from the date of the act or omission giving rise to the complaint, or date of knowledge)
2 – Discretion to decline to issue a formal Ombudsman decision after investigator case
decision if neither party raise any substantive objection to the findings of the case decision (seems to enhance their ability to proceed in the absence information)
3 – Changes to Ombudsman discretion to dismiss or discontinue a complaint in certain
Circumstances (seems to enhance their ability to dismiss or discontinue)
4 – Minor drafting changes to update Scheme Rules including new dates and correcting previous typographical drafting errors
The impression we get is that they are seeking to streamline the process.
Please refer to the detail. Link:
Legal Ombudsman Guidance: https://www.legalombudsman.org.uk/media/xfrfzben/guidance-scheme-rules-april-2023.pdf
Compliance Support from HCL
We provide compliance support across all areas of compliance affecting law firms regulated by the SRA & CLC. Our Data Protection consultants/DPOs also provide support and act as DPOs for businesses outside of the Legal Services sector. Fill in the form below to make an enquiry and see the drop down menus above for more details of services.
Our lead consultant, Ingemar Hunnings, has spoken with Tim Prior, Authorisation Officer at the SRA on 22nd February 2023 to get clarification on this. Tim was quite clear in his response. Foreign Qualified Lawyers who are taking the SQE1 and SQE2 exams are exempt from the requirement for Qualifying Work Experience (QWE). This is the case even if they are newly qualified in their local jurisdiction. This is because they will be tested on the skills in the SQE2 exam.
If the foreign qualified Lawyer wants to be exempted from the SQE2 exam, THEN there is a requirement for them to have 2 years' professional legal experience. That is because they are seeking to be exempted from the SQE2, which would otherwise test this.
Applying for Exemption from the SQE2 exam
See here for more info on how to do this: https://hunningsconsultancy.co.uk/sqe2-exemption-for-foreign-lawyers-review-advice/
QWE External Confirming Solicitor Confirmation Service
See here for more info on how we can help you: https://hunningsconsultancy.co.uk/external-qwe-certification-service-2/
If you are a foreign qualified lawyer from Ukraine, Russia or Belarus (and other ex-Warsaw Pact or Soviet Union countries), the set up of your legal profession, inherited from soviet days, would appear to present a problem if you are seeking exemption from the SQE2 exam on your route to qualifying as a solicitor of England & Wales.
Amongst other things, you are required to provide with your application for exemption a 'Certificate of Good Standing' from your professional regulatory body. In these countries the profession is divided into 2 segments. 1) people who pass a law degree are permitted to practice law and are 'lawyers', but have no regulation or professional regulatory body; 2) there is second group who pass further exams and are then called 'Advokats' and do have a professional regulatory body. Group 2 should have no problem complying with the requirement for providing the 'Certificate of Good Standing' to accompany their application to the SRA for exemption form the SQE2 exam. But what about group 1? They have no professional body to issue that certificate.
We wrote to the SRA asking for clarification on this issue. Below is the email we sent and the reply we received. However, in summary - they will accept other evidence. So this is good news. The SRA have previously confirmed to us that both category 1 & category 2 above of lawyers are regarded as 'foreign qualified lawyers and so may apply for exemption from the SQE2 exam and will be exempted form the QWE requirement. [Please note that people in the above categories may not qualified as advokats may not qualify through the QLTS route.]
(See below for help if you are NOT qualified & need your QWE confirmed to the SRA)
Question
"9.2.23
Subject: SQE2 exemption question
Hi,
I spoke with a colleague of yours in Admissions today. She did not know the answer to my question and suggested I email you.
Someone has asked me and I am trying to find out for them. He is a Russian qualified lawyer. In Russia the are 2 tiers of lawyers:
The gentleman who I am enquiring for falls under category a) above. Your colleague confirmed to us that the SRA would regard him to be a Foreign Qualified Lawyer for SQE2 purposes. Which is fine.
However, obtaining a ‘Certificate of Good Character’ is a problem – they do not have a professional body to which they may apply for this. Can you suggest what he can do to meet the requirement for the ‘Certificate of Good Character’?
Many thanks
Regards
Ingemar Hunnings"
Reply
"17.2.23
Our ref: AUTH/SQE/SP/Hunnings
Dear Ingemar
Thank you for your email of 9 February 2023.
In the absence of a certificate of good standing they can provide a copy of their admission certificate or any additional documentation to confirm they have the required title. This could include for example the academic qualifications that lead to them being recognised as a qualified lawyer in Russia.
All applications are reviewed by a caseworker to determine if the required documentation has been provided. If further information is needed we will let the applicant know before reaching a decision.
If you have any further questions please let me know.
Yours sincerely
Simon Prior
Authorisation Officer
Solicitors Regulation Authority
0121 820 2463"
Another point worth making: if you are qualified but not as an advokat, you might not have practice rights to conduct criminal litigation. If that is the case, you will have to complete section 8 of the exemption application form (see the section below for more info about applying for exemptions from SQE2 and to be able to download the application form.)
SQE2 Exam Exemptions in General
For further information about applications for exemption from SQE2 exam please see this link: https://hunningsconsultancy.co.uk/sqe2-exemption-for-foreign-lawyers-review-advice/
Service - External QWE Confirming Solicitor
If you need or know of anyone who needs an external solicitor to confirm their QWE to the SRA, we can help. Please see here a link to our service: https://hunningsconsultancy.co.uk/external-qwe-certification-service-2/
By statutory instrument the UK government quietly brought in a major change to the costs & damages regime for England & Wales. This will come into effect for all cases issued in the courts from 6th April 2023.
The LS Gazette reports that the government has quietly changed the CPR at the beginning of February to allow the recovery by Defendants of costs from the Claimant’s settlement. This reverses the court ruling in Cartwright v Ho. Defendants will be able to set off costs not only against orders but also deemed orders and agreements to pay against damages as well as claimant costs. This change will apply to all claims issued after 6th April 2023.
So, Claimants will want to ensure they issue as much as they can before 6.4.23. Defendants may want to reassess how they approach Part 36 offers. ATE insurers will want to reassess risk. All will need to ensure that they revise wording of advice to clients on costs.
The Government's financial sanctions regime now includes a ban on providing trust services to those connected with Russia.
The UK regime is operated by the Office of Financial Sanctions Implementation (OFSI). The measures are imposed by the Government to achieve specific foreign policy or national security objectives.
There have been a number of changes to the regime - which is underpinned by several pieces of legislation - in recent times. The SRA have already published guidance for firms to make sure they understand their obligations.
The Government has now made amendments introducing a ban on providing trust services to those connected to Russia (unless the services were provided immediately prior to the regulations coming into force), or to a designated person. The Russia (Sanctions) (EU Exit) (Amendment) (No. 17) Regulations 2022 came into force on 16 December 2022.
Paul Philip, SRA Chief Executive, said: 'Strengthening the financial sanctions regime is an important part of the government's response to war in Europe and law firms have a key role to play. The sanctions regime applies to all firms that provide legal services, not just those that are captured by the anti-money laundering regulations.
'This is a complex and fast-moving situation which is why we published our initial guidance last month. Firms would do well to sign up to alerts from OFSI to keep themselves up to date and also undertake appropriate checks on clients and potential clients.'
The amendment defines 'trust services' as:
A person is considered to be 'connected with Russia' is defined at regulation 19(A)2. Broadly, an individual is considered to be connected with Russia if they normally live in or are located in Russia. A person other than an individual is connected with Russia if it is incorporated/constituted under Russian law or domiciled in Russia. Further information is available in regulation 19(A)2.
OFSI will consider granting licences for trust work if that work falls within one of the following categories:
OFSI has published guidance on the sanctions legislation, including this amendment and updated their guidance on Russia.
Training on compliance with the Sanctions Regime
We provide remote training. Follow this link for more information or fill in the form below to get in touch. https://hunningsconsultancy.co.uk/sanctions-regime-training/
There are 11 of us now in the team - we'll run through the capabilities. Ingemar is the lead consultant & founder covering most aspects, running the company and am the subject expert on LEAP. He is ably supported by Brenda who in addition controls finance, does a lot of admin & prep work. We have an expert in AML & Sanctions in the legal sector, also providing training, who is also our expert on SRA Code of Conduct, SRA Guidelines, Transparency Rules & writes & maintains our OPM. We have 2 experts on the SRA Accounts Rules, law firm benchmarking & anything to do with law firm finance. They also provide training. We have 2 experts on Data Protection, whom we also hire out as DPO as a service to law firms but also other business in the UK & abroad. They also provide training & general support. We have 2 experts in Access Proclaim who provide assistance to firms with workflows, screens, reporting & also in building integrations with other software. We have an expert in CLC law firms & regulation. Finally, we also have an expert in law firm strategy - an ex managing partner of a top 10 UK law firm.
The SRA has published guidance for the firms and solicitors it regulates on how they should supervise staff.
They have written:
"This guidance should help regulated individuals and law firms’ managers and senior staff understand what we expect them to do to meet the current statutory and regulatory requirements on supervision.
The guidance should help legal services providers to meet the requirements in our Standards and Regulations, and to comply with other relevant legal and regulatory requirements on supervision. Firms seeking our authorisation should find the guidance helpful in setting out what we expect from them in terms of arranging adequate and effective supervision at the point of authorisation and beyond.
Effective supervision is both a regulatory requirement and good practice in the delivery of services to clients. While negligence in the delivery of legal services is not itself always proof of a failure in supervision, effective supervision has a role to play in managing negligence risks, as well as other regulatory risks."
Here is a link to the full text of the Guidance: https://www.sra.org.uk/solicitors/guidance/effective-supervision-guidance?s=01
We suspect that the SRA will use this as a benchmark when reviewing firms, considering complaints and disciplinary issues. We recommend that firms review their policies & practice in the light of this guidance.
We Can Help
Please feel free to contact us if you would like assistance with reviewing policies & practice or indeed in writing policies if you do not have them. We provide a lot of compliance support for SRA & CLC regulated firms, in-house legal and other businesses. Please see the 'Services' drop down menu at the top of this page. We invite you to fill in the form, which you will find on every page on this site, to make further enquiries.
One of our clients for whom we confirmed her QWE has kindly send us her explanation for how she applied for exemption from the SQE1 exam via her 'MySRA' profile on the SRA website.
You may access a downloadable guide we have created from this here: https://hunningsconsultancy.co.uk/wp-content/uploads/2022/12/How-to-apply-for-SQE1-Exemption-if-you-have-passed-the-LPC.pdf
(Please note - you have until 31 December 2032 to qualify as a solicitor under the LPC route. However, obtaining a Training Contract is likely to become increasingly difficult as employers switch over to facilitating qualification through the SQE route.)
QWE Confirmation
If you are seeking someone external to your business to confirm your QWE - we can help. Indeed we have helped well over 40 aspiring solicitors so far by confirming their QWE to the SRA. Our lead consultant, Ingemar Hunnings, always offers a free, no obligation zoom first to examine if it is appropriate and to explain the process. Fill in the form below to get in touch. Follow this link to read more about this service: https://hunningsconsultancy.co.uk/external-qwe-certification-service-2/
The SRA has now published guidance for the firms it regulates. Find the link below.
https://www.sra.org.uk/solicitors/guidance/financial-sanctions-regime/
Training
Should you or your firm want training on the Sanctions regime, we can help. Please find a link to our training service here: https://hunningsconsultancy.co.uk/sanctions-regime-training/
