Election purdah and the nascent holiday season have muted the news klaxon somewhat. So the reprise of a couple of golden oldies is welcome.
First, the liberalisation of legal services in India – the anticipation of which has been akin to waiting for Godot. At last, we may be on the cusp of a real breakthrough. The Bar Council of India hopes to implement regulations governing the entry of foreign lawyers and firms to India soon.
One to watch. At the risk of being awarded Private Eye’s Order of the Brown Nose, the Gazette commends the Law Society’s persistent and indefatigable international team for getting the profession to this point.
Second, and more relevant to most solicitors, the future of the client account is rising up the regulatory agenda again as part of the Solicitors Regulation Authority’s consumer protection review.
CEO Paul Philip told me nearly a decade ago the client account was in the regulator’s sights, amid consultation on extending the use of third-party managed accounts. Given the proportion of prosecutions before the Solicitors Disciplinary Tribunal that involve the misuse of client money, I joked then that Philip was at risk of putting himself out of a job.
Unfortunately, there wasn’t really a market for TPMAs. Anyone remember Barco? Shut down in 2018.
The Society mounts a robust defence of the client account in its new discussion paper on client protection. But the 18-page document charts new ground too, not least with regard to the SRA’s own approach to the subject. In the wake of the Axiom Ince debacle (and pending publication of the Legal Services Board’s report on the role of the SRA ahead of the collapse), Chancery Lane reckons the regulator ought to toughen its approach to due diligence on law firm acquisitions. Ideas mooted include more in-depth enquiries into the financial viability of entities before approving deals, and leaning on banks where client money is held to report ‘unusual’ activity.
‘Such an approach may have safeguarded client funds in the Axiom Ince case, where significant transfers took place from Barclays Bank to the State Bank of India,’ says the Society, rather pointedly. Such an approach may also have saved solicitors a bundle in extra compensation fund contributions. I suppose we’ll never know.
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