The Solicitors Regulation Authority will call on the government for permission to impose on-the-spot fines for firms that fail to comply with regulatory deadlines.
Hundreds of firms are thought to have failed to submit nominations for compliance officers more than a month after a deadline of 31 July. The new compliance officers are expected to begin their roles on 1 January. At the SRA board meeting today, executive director Samantha Barrass said the regulator was likely to press the Ministry of Justice and the Legal Services Board for extra powers next year.
She said: ‘Top of our shopping list for secondary legislation change would be some capacity for automatic administrative fines as you would have if you don’t fill in your tax returns.’
The experience with compliance officer nominations, she added, would be used to mount the case for more straightforward fining powers. The SRA already has the power to issue a £2,000 fine for low-level misconduct, but only after a lengthy disciplinary process.
Barrass said she was encouraged that more than 90% of firms had nominated their compliance officers for legal practice (COLPs) and for finance and administration (COFAs). Three reminders were sent to the defaulters during August, with a further one to be sent out shortly, she said.
‘We gave them time during August but now it is critical they nominate. If we get to 1 January and we have firms who have not nominated they will be in breach of regulations and we can impose revocation of the licence and disciplinary action.’
The two new roles - COLPs and COFAs - are a key part of the SRA's move to outcomes-focused regulation (OFR), introduced last October. They are responsible for ensuring that firms have suitable systems and controls in place to comply with the new regulatory requirements.
While responsibility for this compliance rests with the firm, its managers or the sole practitioner, the compliance officers must ensure compliance, and are responsible for recording and reporting failures in compliance.