HSBC has established a conveyancing panel of solicitors and licensed conveyancers to provide legal services to its residential mortgage customers. Solicitor member firms must have the Law Society’s Conveyancing Quality Scheme (CQS) accreditation.

The panel, managed by Countrywide, will launch on Monday across the UK. Of the 43 members, 39 are solicitor firms and four licensed conveyancing companies.

The panel is not closed and others can apply to join. HSBC has 5% of the UK’s mortgage market. It introduced the new panel in response to the Financial Service Authority’s recommendations for tackling mortgage fraud.

Customers will continue to be free to use their own solicitor or conveyancer to act for them, but HSBC will use a panel firm for its own legal requirements. Where a customer chooses a non-panel firm, the new process will separate the two pieces of legal work, and the customer will pay for both.

Where customers appoint a panel firm to act for them, work will be carried out for a fixed fee. They will be able to monitor the sale online and check to ensure the solicitor is carrying out the work in a timely manner.

Head of mortgages at HSBC Peter Dockar said: ‘Our new panel arrangement will spare customers the time and hassle of searching for a firm to do the important conveyancing work on their new property. Customers who choose to use a firm on the panel can benefit from agreed conveyancing costs as well as valuable guarantees should the seller pull out. We also believe this will provide additional protection for our customers and HSBC.’

The Law Society welcomed the requirement that law firms on the panel have the CQS quality mark, but raised concerns over the small size of the panel.

Chief executive Desmond Hudson said: ‘HSBC’s decision to appoint only CQS accredited firms to its panel is further evidence that the scheme is firmly establishing itself as an essential standard for lenders. Nevertheless, we are concerned that fewer than 43 firms will serve home-buyers who use HSBC for their mortgage in England and Wales. Does this provide sufficient consumer choice?’

Such a small number could restrict the choice available to consumers who prefer to use a local service, he said.

‘The disabled, those living in rural areas or even those wishing to simply use their family solicitor will either have little choice but to opt for the same solicitor as HSBC, one of their panel firms or pay twice over for their own solicitor as well as HSBC’s legal fees,’ said Hudson.

He added: ‘It is disappointing that HSBC failed to consult the Society. I suspect they have made the calculation that the majority of their customers will opt to use the bank's solicitor.’ He also raised the possibility of the bank being tempted to sell valuable places on the panel, thus putting up costs for house buyers. ‘This is not in the long-term interests of consumers. HSBC should reconsider.’