SRA tells in-house lawyers they must report wrongdoing

In-house solicitors have been reminded they must report serious wrongdoing they may uncover within their organisations - or consider leaving if they are still unable to stop it.

The in-house profession has come under the spotlight over the past year following revelations about the role of professionals at the Post Office Inquiry. 

The Solicitors Regulation Authority this week published materials aimed at helping the 34,500-plus in-house solicitors in England and Wales decide how best to respond to potential criminal or unethical activity.

The guidance acknowledges that it may be difficult to balance duties to the client with the wider public interest, but stresses that in-house lawyers are there to offer ‘candid’ advice and to make sure organisations understand their legal obligations.

‘For that reason, solicitors are required to report material concerns internally,’ says the guidance. ‘And play a crucial role in supporting the rule of law, and ensuring appropriate transparency and accountability, by bringing appropriate matters to the attention of regulatory and prosecuting authorities.’

In-house solicitors operate under the duty to act in the best interests of each client and keep client affairs confidential unless required by law to disclose them. But they must also act with independence, honesty and integrity and uphold the role of law and public trust in the profession.

The new guidance adds: ‘If the principles come into conflict, those which safeguard the wider public interest take precedence over an individual client’s interests, for example, the interests of your organisation. This includes acting with integrity, independence and in a way which upholds public trust and confidence in the solicitors’ profession.

‘You should, where relevant, inform your employer in advance of the circumstances in which your duty to the court and other professional obligations will outweigh your duty to them.’

Solicitors are expected to report breaches of the law or regulatory requirements, and any circumstances where loopholes are being exploited to get round rules. Such matters must be reported even if colleagues or managers have urged in-house lawyers to hide or downplay them.

Where wrongdoing continues despite a solicitor’s intervention or reporting to their manager, ‘you should carefully consider whether you can meet your regulatory obligations and continue working for your organisation’.

The guidance adds: ‘You will need to reflect on whether you can personally continue to act with independence, integrity and in a way that upholds the rule of law and the proper administration of justice, whilst working where the wrongdoing persists.’

The SRA has included more information on who to report concerns to and how to manage internal investigations as part of the materials published today. It also address where legal privilege does and does not apply.