CLC issues statement on risk management tools
In a statement issued today the CLC T backed the use of risk management tools as a way to minimise the risk that could face clients.
The statement reads;
"The CLC encourages the practices it regulates to consider how they can mitigate risk to protect the interests of clients and to minimise claims made against them. There are now a broad range of different products on the market offering solutions to different types of risk. In the CLC’s view, the most effective way a practice can minimise risk in any area is to ensure that it has appropriate and proportionate processes and procedures to supervise and quality assure services which are being provided. These should be developed and managed internally. They can be supported by a variety of commercial products, provided it is understood that none of those products offers a complete and risk-free solution.”
As to whether these tools should be charged as disbursements the statement said that disbursements are defined in CLC’s glossary as ‘Payments made to a third party on behalf of a client’
The CLC continue their statement by stating:
“It would be good practice for the practice to obtain the client’s specific informed consent for that disbursement to be incurred.”
Chris Harris Managing Director of Lawyer Checker welcomed the statement “There are a growing number of new tools to help protect clients and the conveyancer from fraud and mistake. Lawyer Checker helps conveyancers check that the other side is a valid firm and given the levels of fraud in the market we welcome this cost being deemed to be a disbursement within the confines of the CLC statement.”
Julian Sampson, Director of Jet Convey agrees, “the trend towards evidencing systems and controls, replicating what has existed for sometime already in lending, is to be welcomed. The CLC joins the SRA and the CQS in now requiring both transparency and auditability in process. The ability for firm’s to “show their workings” and to take advantage of the support systems that exist has never been more important. Specific mischief solutions like LawyerChecker or whole of transaction solutions like JET and TM are all designed with regulatory obligations in mind, as well as satisfying coal face issues.”
Since this article was published the CLC have contacted Today’s Conveyancer asking us to remind readers that the CLC does not endorse any individual or class of product. We apologise if the article was misleading in this way.
Lawyer Checker is available from many leading search providers.