A Yorkshire firm which did not tell clients they were helping to fund loan repayments has been fined more than £30,000.
The SRA said it had reached a regulatory settlement agreement with Doncaster-based Taylor Bracewell Law Limited after misconduct involving some 2,225 clients.
It was outlined in the agreement that Taylor Bracewell Law Limited had borrowed £60,000 to buy a new case management system which was installed in 2018. As part of the commercial loan agreement with Property Search Group, the firm agreed to order conveyancing searches from it for all conveyancing transactions it was handling, until the loan was repaid.
Each client was charged £193 for the search pack, which included a loan repayment contribution of £18. The firm did not tell clients that the fee they were paying for searches included this contribution. Over more than two years, the clients paid a total of £40,050 through these levies.
The firm stopped charging clients the loan repayment contribution in October 2019 and returned all monies to client accounts earlier this year.
The firm admitted not treating its clients fairly and failing to behave in a way that maintains public trust. In mitigation, it put forward that allegations of misconduct were accepted at the earliest opportunity, the firm has returned the loan repayment contributions and it has co-operated with the SRA’s investigation.
The regulator found this issue affected a large number of clients over a long period of time, when the firm had direct control over the charging issue.
Based on the Taylor Bracewell’s annual turnover of almost £3m, the SRA considered that a basic penalty of £38,175 was appropriate and acted as a ‘credible deterrent’ to the firm and others. This was reduced to £30,540 based on the firm’s early admissions and co-operation with the investigation.
Taylor Bracewell will also pay £1,350.