The Solicitors Regulation Authority was placed on the spot over ethics and transparency last week after allegedly ‘jumping the gun’ with new measures to liberalise legal services.
Online document platform Rocket Lawyer confirmed that it had been granted the right to employ solicitors offering legal advice despite not being SRA-authorised. It is using the ‘safe space’ waiver announced by the SRA which allows unregulated businesses to offer legal advice through regulated solicitors, ahead of changes in the rules due to come into effect next year.
Leicestershire human resources consultancy Croner has also been granted a ‘safe space’ to bypass regulations in pursuit of innovation.
The SRA has refused to make details of each waiver arrangement public, saying this is commercially sensitive information. But regulatory specialists said the policy raises questions about the future of alternative business structures and client protection.
The Gazette understands that clients of companies with waivers will be able to complain to the Legal Ombudsman about individual solicitors if they are unhappy with their service. No waiver applicant has applied to handle client funds.
An SRA spokesperson said: ‘We will only grant waivers where there is clear evidence that they are in the public interest, and that users of legal services are protected.’
The issue of unauthorised firms hiring authorised solicitors was subject to a consultation last year and rules are not expected to change until next year. Frank Maher, partner at Liverpool firm Legal Risk, said the SRA is ‘jumping the gun’ on its own proposals and needs to reveal its processes for allowing a waiver.
Experts have warned that waivers may reduce the need for alternative business structures (ABSs), as non-lawyer owners can now take on solicitors without the time and cost of applying for ABS status.