The oversight regulator’s report on the Solicitors Regulation Authority’s handling of the Axiom Ince collapse will not be published until after the general election, it was revealed today. Announcing the delay, the Legal Services Board said that as a public body it is bound by guidance not to compete with the election campaign for public attention.

The LSB opened a review into events leading up to the SRA’s intervention into Axiom Ince in December, pledging at the time that the report would be out this spring.

That deadline will not be met, leaving the profession waiting for an explanation why the national firm was able to create a £64m hole in the client account, which will now have to be filled with increased contributions from solicitors and firms.

The LSB said it now expects to publish 'after the general election on 4 July'. The delay 'will not prevent us from pursuing any required action or matters arising from our review in the public interest'.

Despite the explanation about guidance for public bodies, the LSB is also likely to face questions why an organisation that claims to be independent of government needs to effectively put its work on hold during election purdah. The regulator has in the past been cited as an example of creeping government control of the legal profession, with its independence called into question by the International Bar Association.

The oversight regulator has partnered with Northern Ireland firm Carson McDowell to carry out the Axiom Ince review. The investigation looks at the ‘adequacy, efficiency and effectiveness’ of the SRA’s actions and executives at the solicitors regulator have been interviewed as part of the process.

It would have been particularly uncomfortable for the SRA if the review had been published in the same week as it announced that contributions to the compensation fund, which ran up a £29 million deficit last year, are to soar. The Gazette revealed last year that it took the SRA three months to send staff into Axiom after it had bought the much bigger Ince & Co. It later emerged that client money had been used to finance the acquisition, as well as to purchase a string of properties.

Meanwhile, the LSB is continuing to review the SRA’s regulation of collapsed Sheffield firm SSB Group, which went into administration at the start if this year.

Carson McDowell is again engaged as an independent third party, asking whether the SRA acted effectively, took all the steps it could have done, and whether changes need to be made to prevent a similar situation arising again. That report is due to be published in the autumn.

 

This article is now closed for comment.