The Law Society’s withering response to the SRA’s client money consultation not only crosses the Rubicon, but burns the bridge as it proceeds.
We are accustomed to robustly worded protests from Chancery Lane about the regulator’s powerplays and empire-building. This 46-page document appears to go further. To me at least, it reads like a letter of no confidence. How so?
There is a clue in the Society’s press release, which deploys the word ‘slams’ in the headline. Startlingly intemperate language, in context – but surely calculated. The Society has been criticised for allegedly pulling its punches amid the SRA’s crisis of credibility. Some claim Council members are muted by internal governance rules. It certainly can’t be accused of that here.
Like the Joint V law societies, the Society turns the regulator’s fire back on itself. All but ‘a tiny minority of firms comply assiduously with the SRA’s rules in relation to client money’. That’s not the real issue, we are invited to infer. Rather, the regulator would be better employed putting its own house in order following the Axiom Ince debacle and ahead of the LSB’s forthcoming report on the equally spectacular collapse of SSB Law.
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‘Careful consideration should be given to consumer [safeguards]..but also to how supervisory and compliance frameworks can be applied more effectively and proportionately.’ Rough translation: ‘you don’t know what you’re doing’.
And what’s this? ‘The SRA does not seem to fully understand how different models and sizes of law firms operate,’ says the Society. A watchdog ignorant of its own patch can fairly be described as failing, even incompetent. Though the Society does not say this in so many words – perhaps it can’t – how else can one interpret that statement?
The Joint V and Chancery Lane remain exasperated (|and solicitors alienated) by the regulator’s continuing refusal to properly assimilate the lessons of Axiom Ince. Suspicion abounds that further compliance reforms such as client account curbs are not really about consumer protection, but self-preservation. Note too the SRA’s bid to emasculate the disciplinary tribunal, which cannot always be relied upon to take its side.
With the Cube’s leadership defiant and its non-executives apparently mute, we seem to have reached an impasse. The SRA is not for turning. Or learning.
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