The Solicitors Regulation Authority was told more than six months ago that a Sheffield firm facing administration posed a regulatory risk through non-payment of debts, it has emerged.
The Gazette has spoken to a creditor owed a large sum by SSB Group (trading as SSB Law), which gave notice this week of its intention to appoint an administrator.
The creditor reported that they were owed money going back several months and asked the SRA to investigate whether there was any financial irregularity. It is understood that the SRA did send forensic investigators into the firm earlier this year but did not find evidence that regulatory action needed to be taken.
Specialist business advisory firm FRP is the proposed administrator and will report on how much the company owes. The firm has said it is in contact with the SRA to ensure standards and regulations are met. Directors admitted the business has suffered ‘ongoing financial challenges’ and had been marketed for sale. It is understood that the first winding-up order was made against SSB in August this year.
The SRA has said it cannot comment on specific cases and would not confirm or deny if it has received a report relating to a law firm. A spokesperson said: ‘It is only if disciplinary or regulatory action is necessary that it becomes a matter of public record. If we do receive reports about a firm, then we will look at the information before deciding on next steps.’
The most recent accounts for SSB Group, for the year ended April 2022, show the company had taken on loans of £30m in the previous year and owed £48m to creditors – including £15m to trade creditors – within the next 12 months.
The role of the SRA in examining firms’ finances has come into sharper focus in recent months with the intervention into Axiom Ince over a client account shortage of more than £60m.
The Gazette revealed last week that the regulator took almost three months to send investigators into Axiom Ince after the first of its eye-catching acquisitions using client money.
