The Solicitors Regulation Authority has suggested that it has government backing to reopen the issue of its limited maximum fining powers. The regulator can currently fine firms and individuals up to £2,000 for misconduct, after which the matter is remitted to the Solicitors Disciplinary Tribunal.
Efforts to increase this threshold have been thwarted in recent years, but the SRA this week said it would support any discussion of its fining powers, and revealed that the government has committed to look again at a potential increase.
Speaking to the media yesterday, chief executive Paul Philip said he would like to see ‘parity’ with the SRA’s powers to sanction alternative business structures. For these entities the regulator can fine individuals up to £50m and the ABS itself £250m, although nothing like these penalties have ever been issued.
Philip added: ‘It is very difficult to argue why there is a difference (with ABSs). Our ability to conclude matters with an appropriate fine, with a right of appeal to the tribunal, would be hugely efficient for the profession.’
As long ago as 2013, the SRA’s regulatory risk committee was discussing new fining powers of up to £50,000, or linking fines to the domestic turnover of the firms involved. Those plans were shelved, but the issue was kept alive by the Insurance Fraud Taskforce, which recommended the government should consider strengthening the SRA’s hand for dealing with fraudulent or corrupt activity.
In a response to the taskforce report published today, the SRA said the current limit means too many cases go to the tribunal. ‘That means more time is taken to resolve a matter, associated costs to both the firm and the SRA (and thus the profession) go up and the stress and uncertainty for the firm and individuals involved increases. Until changes are made it is difficult to impose proportionate financial penalties,’ the response states.