The Solicitors Regulation Authority (SRA) has finalised the work it needs to do to identify firms that have failed to secure a new insurance policy and are in the Extended Policy Period (EPP).
Those firms have to find cover or properly close their practice by 29 December 2013.
The SRA established that, as at 16 December, there were 117 firms requiring insurance because they have not yet properly closed where there is currently no evidence of the firm having a new indemnity insurance policy in place.
The SRA is working with the 117 firms in the EPP to remind them of their responsibilities through regular and proactive engagement and the use of Compliance Plans.
108 Compliance Plans have been sent to firms, with 94 having been signed and returned by managers.
Of the 117 firms, seventeen of those failed to comply with their obligation under Rule 17.3 of the SRA Indemnity Insurance Rules 2012 to notify the SRA that cover was being provided by their current insurer under the EPP.
Disciplinary action will be considered at a later stage for those firms, but the SRA’s current focus is on ensuring orderly wind down where indemnity is not obtained.
Disciplinary action will also be considered for firms that delay in returning signed Compliance Plans or firms that fail to give the required regular updates to the SRA of their position.
Mike Haley, SRA Director of Supervision, said: "Some firms are better than others when it comes to addressing all the issues associated with an orderly wind-down, for example ensuring archived files are stored properly. We continue to work with firms to remind them of their responsibilities and the approaching deadline for closure.
"All of these firms are aware that they should not be carrying out any work on behalf of clients beyond 29 December as they would be doing so without insurance, so all live client matters and client monies must be dealt with by that date.
"Firms that continue to practise after 29 December or fail to wind down in an orderly fashion will be subject to swift regulatory action. Exercising our powers of intervention may be considered where it is necessary and appropriate in the public interest."
Guidance on orderly wind-downs is available here.
