SRA latest application to increase fining powers

The Solicitors Regulation Authority (SRA) are one step closer to achieving long-term aspirations to increase fining powers they can impose on “traditional” solicitors and law firms. An application has been recently submitted which requests an increase to their limit five-fold – from £2,000 to £10,000.

Any changes of this degree are always be presented to the Ministry of Justice, who have to approve the application before it can be put into practice.

The SRA originally sought to have the same level of powers they have for ABS, which allow them to fine at a limit of £250 million for organisations and £50 million for individuals. However implementation against “traditional” law firms was denied by Ministry of Justice, even though comparable regulators have a similar level of in-house fining powers.

In November 2013 the SRA requested views in a consultation on increasing the fine limit, suggesting sums of £10,000, £50,000, £100,000 or an alternative figure — without the need for a Solicitors Disciplinary Tribunal (SDT).

Following the consultation, a response has been released and an application has been submitted to the Ministry of Justice to increase fining levels to a comparatively modest £10,000.

There were a total of 37 respondents to the consultation and the SRA claim many of these are in support of the plan.

In a response from the City of London Law Society, they summarise why they feel the suggested £10,000 is applicable, commenting, "A moderate increase to £10,000 is appropriate and represents an equitable balance between the savings of costs and the maintenance of an independent, fair disciplinary process."

The Legal Services Board and Legal Services Consumer Panel are both in support of an increase, but at a higher level of £100,000. The SRA have agreed this would improve "efficiency and consistency". However they say a limit of £10,000 would the speed and efficiency of imposing fines, as well as reduce overall costs of both parties.

Though the majority of imposed fines fall below the proposed £10,000, and the increase would reduce the number of initial cases handled by the SDT, they are in opposition of the plans and have submitted their own application to the ministry for review.

In addition to the fining powers application, discussions will be held between the SRA, Ministry of Justice and Legal Services Board to decide whether higher fines could be implemented with the consent of the regulated firm, while a regulatory settlement is being negotiated.

What fine level to you deem appropriate? Should “traditional” law firms and ABS be treated separately?

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