The Solicitors Regulation Authority’s guidance on reporting serious misconduct is legally deficient and lacks clarity, three legal experts have told the regulator.

In a letter to the SRA, Professor Richard Moorhead, LawTech UK director Jenifer Swallow and former Herbert Smith Freehills partner Graeme Johnston have asked the regulator to issue improved guidance on when and how lawyers need to report or disclose client wrongdoing.

They say the current guidance appears to be wrong in law in insisting that solicitors must have information ‘sufficiently detailed or compelling enough for you to form an opinion that a serious criminal offence will occur’.

They say ongoing wrongdoing is not addressed, which is particularly relevant in commercial work, and that there is an absence of realistic commercial examples. The guidance is confusing on privilege, unbalanced on data protection and contains no mention of whistleblower protections, they add.

Johnston, founder of software company Juralio, said the current guidance does not 'adequately articulate' the circumstances in which lawyers must report concerns and tends to minimise the situations where reporting is appropriate.

Swallow said client confidentiality is a core principle of legal practice but misconceptions abound and called for clarity: 'This is something on which the SRA and other legal services regulators can lead, in the interests of supporting the efficacy, tenor and pace at which issues and wrongdoing inside organisations are alerted and addressed,' she said.

Moorhead, professor of law and professional ethics at the University of Exeter, said: ‘We can point to a number of serious scandals where wrongdoing by a client is ignored or finessed away by their lawyers rather than being properly dealt by the proper decision-making bodies of those organisations.

‘The SRA can better support lawyers in some of the trickiest dilemmas of their professional lives by providing clearer guidance which deals not only with the nuclear option of disclosure of wrongdoing but how to manage the process of reporting up within organisations.

‘Having discussed key examples with many lawyers, I am convinced that better, more commercially focused guidance here would help. And new guidance would enable the SRA to work with practice to lead a debate on a crucial governance issue.’

A spokesperson for the SRA said: ‘We have received the report and will respond to Professor Moorhead in due course.

 

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