A practice in Bournemouth handling thousands of bank refund claims has been fined £45,000 by the SRA – one of the biggest sanctions ever issued against a firm.

Dorset firm slapped with £45,000 fine for claims failings

Source: Jonathan Goldberg

The SRA said TMS Legal Ltd submitted claims with inaccurate information, continued to act on two matters where clients asked it to stop, and failed to effectively supervise non-legally qualified staff.

The firm, which was authorised as an alternative business structure in 2018 and employs around 30 staff, acted for clients making claims against banks for mis-sold packaged bank accounts. In the space of just 12 months up to the end of June 2020, the firm had dealt with around 30,000 matters.

The SRA then received reports from two banks about the conduct of the firm and the quality of the claims being submitted, with the regulator making an onsite inspection in July 2020.

Among the 43 files reviewed, investigators found the firm did not carry out sufficient client due diligence leading to inaccuracies in claims.

TMS Legal provided information in tailored questionnaires using a process whereby staff inputted the information using a standard wording system, sometimes resulting in differences from the information supplied by clients to the firm. It was admitted that on some occasions the firm had failed to seek clients’ consent about the content contained in questionnaires.

The SRA said managers of the firm had taken swift action to revamp its client identification and due diligence procedures once shortcomings were identified, with the risk of repetition now deemed to be low.

It was accepted that the failures, on two occasions, to cease acting on claims when asked to do so by clients represented 'isolated and inadvertent' errors.

There was no suggestion of any deliberate attempt to misrepresent or enhance claims.

The SRA noted that TMS Legal had co-operated with the investigation throughout, reviewed and updated its supervision and quality police, and provided compliance training to staff.

The regulator said the fine served as a ‘credible deterrent to both the firm and the wide profession, including other firms working in this sector’. The SRA was able to impose a sanction as high as £45,000 because of the firm’s status as an ABS. TMS Legal also agreed to pay £1,350 costs.