A firm that failed to investigate or resolve discrepancies in the client account promptly enough has been fined by the regulator despite it finding no dishonesty or loss to clients.

SRA sign inside The Cube

Source: Jonathan Goldberg

Kent firm Rootes & Alliott was fined £1,900 after the Solicitors Regulation Authority found breaches of account rules in its annual submitted report.

Following an onsite inspection, the SRA found there had been differences on the client account reconciliations from April to October 2022 which had not been rectified. The firm also did not keep accurate, contemporaneous and chronological client account records in accordance with the rules.

The cash shortage on the client account was around £9,300 and the firm rectified this promptly during the course of the SRA’s inspection.

Rootes & Alliott admitted breaching the rules requiring firms to keep and maintain all receipts and payments and a list of all the balances shown. It also failed to provide a cash book showing a running total of all transactions and did not complete, as required, a reconciliation of the balance sheet at least every five weeks.

There was no monetary loss or harm to client funds and no dishonesty on the part of the firm, the partners or any employee.

The firm has taken remedial action to resolve all the breaches and made improvements to its accounting processes. During the investigation all client account reconciliations were brought up to date.

But the SRA stressed that a fine was appropriate to maintain public confidence in the profession and provide a deterrent to others, although it accepted that the impact of the misconduct was low because it had no direct material impact.

The firm also agreed to pay £675 in costs.