Conveyancing Sentiment Optimistic Despite Brexit
Sentiment amongst conveyancers remains strong with 45% anticipating an increase in their workload over the next 12 months.
42% of the 212 law firms regulated by the Council of Licensed Conveyancers (CLC), participating in the Annual Regulatory Return (ARR) 2018/19, were confident the work each firm will receive will remain the same whilst 13% are worried workloads will contract in the next 12 months.
Brexit is now cited as the main risk to the legal sector according to a third (30%) of CLC regulated firms. Political uncertainty is causing a lot more anxiety in the current climate with the figure rising from 19% of respondent firms a year earlier.
The threats caused by cyber crime infiltrating a law firm are also perceived to be a more pressing concern in the present, rising from a fifth (22%) in 2017/18 to over a quarter (26%) in the most recent review.
Despite a recent sweep of CLC inspections finding 34 out of 51 firms non-compliant largely due to money laundering oversights, compliance issues around economic fraud decreased this year from 34% a year ago to 25% in the most recent report.
In part, this was due to a larger percentage of CLC regulated firms escalating their due diligence concerning money laundering. Almost a quarter had made at least one suspicious activity report (SAR) whilst 11% had made a ‘defence against money laundering’ SAR.
Although there have been many changes to the conveyancing sector in the past 12 months, traditional pathways to finding new work remain consistent.
37% of firms are dependent on personal recommendations for the business they receive, a quarter rely on referrals from estate agents with 13% citing direct approaches from clients as a source of conveyancing work.
Sheila Kumar, CLC Chief Executive, commented:
“Against the background of uncertainty created by Brexit there has been remarkable consistency in the performance and outlook of the practices we regulate. It is encouraging to see how many firms expect to keep growing in the coming year.
“The efforts to improve transparency for consumers are still in their early days, but the very high levels of compliance with our new rules – and the signs that consumer behaviour is starting to shift – is a testament to CLC-regulated firms’ commitment to the public interest and enabling consumers to make an informed choice of property lawyer. When the rules were first introduced practices were concerned that publishing prices would create a ‘race to the bottom’, but this has clearly not happened.
“We as a regulator and our regulated community have worked hard to identify and combat the risks of fraud, money laundering and cyber crime, and the signs are that this is paying off. But we are all too aware of how quickly criminals adapt, so focusing on these dangers remains one of the central priorities of our monitoring work.”
What do the figures suggest about the future of conveyancing? Do you feel Brexit presents the most significant risk in the present?