Web 'hitting profits'

LAW ON-LINE: firms losing money on virtual services

Firms are turning their backs on selling legal services on-line because it has proved to be unprofitable and unsatisfying, with anti-money laundering laws making it an even bigger burden.

The trend emerged after firms that formerly advocated selling services such as wills and leases on-line suspended the practice because clients were using them instead of traditional methods.

Legal IT expert Delia Venables said she has found it is 'no longer hot' to sell documents on-line, or to use a mail-merge system to produce documents from forms completed on-line by clients.

'In most cases, the provision of these services is not profitable.

It means firms undercut themselves,' she explained.

Ms Venables said solicitors were also put off by the lack of personal contact, saying it was not very profitable or satisfying.

Michael Kaye, senior partner in north London firm Kaye Tesler, was a pioneer of on-line selling as 'a constant flow of easy work'.

But he said problems had been generated by anti-money laundering legislation, which means that clients must execute documents in front of a solicitor.

'The whole point was that the clients would fill out the questionnaires, and it would be the same as if they were sitting opposite me answering the same questions,' he said.

'But because of client identification requirements, the whole basis - that you don't actually have to see the client - goes by the board.'

He is now set to launch an on-line training package focused on how to avoid falling foul of the laws.

However, Ms Venables insisted that firms were still taking advantage of technology in other ways.

'People are still looking for additional services from their solicitors, and this may be via the Internet,' she said.

She added that, for example, monitoring the progress of cases on-line is still popular.

Paula Rohan