The Solicitors Regulation Authority missed numerous opportunities to intervene into a law firm group where some £40m of client money went missing, an investigation has revealed.
A report commissioned by the SRA into the handling of PM Law found the regulator conducted two separate investigations in 2023 and 2025 – neither of which prompted significant action – before PM closed suddenly earlier this year. The SRA then intervened two days later to close the 11 practices operating under the PM Law umbrella.
The report, by City firm Jenner & Block, detailed how numerous reports of potential misconduct were made in the three years before the firm closed, none of which prompted urgent action.
It concluded that the SRA held information abut PM Law Group that, taken together, could have been sufficient to justify a more pressing and coordinated response. Despite being identified as a ‘high risk’ firm – and this fact being discussed at a meeting in September 2024, there was no continued scrutiny or review by investigation teams.
Knowledge collected about the group and issues with various firms was ‘fractured’ and never drawn together across departments to give a complete picture of the risk presented. The forensic investigator who conducted a visit in 2025 was not even told of a similar investigation in 2023, while a thematic team who had looked into the group did not share its findings with teams handling reports of misconduct. Nobody at executive, board or deputy executive director level was aware or informed of the risks posed before February 2026.
The report said: ‘The central finding is one of a failure to aggregate information. The SRA held more information about the PM Law Group than was ever drawn together into a single, coherent risk picture. Consequential decisions… were therefore taken in conditions of partial information, against a risk more serious than the decision-maker was able to appreciate. This was not principally the product of individual error, though errors were made; it reflects a structural limitation in the SRA’s operational architecture.’
PM Law timeline of missed opportunities
- February 2023: SRA visits Proddow Mackay (Conveyancing), two years after a report by a former employee making several serious allegations
- January 2024: PM Law included in spreadsheet of accumulators to monitor but removed six months later
- August 2024: Compliance officers visit PM Law as part of thematic review and designate group as ‘high risk’
- March 2025: Forensic investigation into PM Law lasting three months
- July 2025: Report made into 3M Law, a member of the group, after reports of money missing from client account
- February 2026: PM Law Group shuts overnight with no advance warning to clients or staff
The report recommends that the SRA improve its technological capability to bring together intelligence and provide better training and stronger supervision to investigate the financial position of complex group structures. It must also establish fully defined escalation criteria so that concerns are raised with senior staff without depending on the initiative of individual officers.
The cost to the compensation fund – paid for by members of the profession – from PM Law is likely to be second only to the £39m paid out to clients of another collapsed firm, Axiom Ince. The SRA is already in the middle of trying to reform its processes following a damning report into how that firm was handled before it closed in 2023.
Anna Bradley, SRA Board chair, said: ‘The PM Law report makes for difficult reading. We are particularly sorry for the impact this has had on former clients of the firm and accept we should have done better by them.
’The board is disappointed that we missed opportunities to act on PM Law sooner given the work we have already done to change the way we regulate. The independent assurance report from the Berkeley Partnership illustrates the progress we have made. But we always knew that this programme of work was going to take significant organisation-wide change, and the Jenner & Block findings make it clear that we have much further to go.’
Commenting on the findings, Law Society of president Mark Evans said the independent review 'paints a bleak picture' of the missed opportunities for the SRA to act sooner.
'Once again, the profession as a whole – solicitors and law firms – has had to shoulder the financial consequences through a substantial increase in contributions to the Compensation Fund, costing approximately £30m,' said Evans. 'The fund provides vital protection for clients and consumers, but the cost of regulatory failings should not continue to fall on the wider profession.
'It is clear from the report that the SRA needs to take urgent action. While steps are already being taken by the SRA, meaningful reform needs to be delivered swiftly to prevent yet another failure of this scale from happening again.'
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