The client account scheme run by the Bar Council for the benefit of direct-access barristers is to alter its price structure this summer to attract more solicitors, the Gazette has learned.
BARCO, which was started almost three years ago, charges a commission for holding client monies in a secure account.
The scheme came under the spotlight this month after the Solicitors Regulation Authority proposed allowing solicitor firms to choose an alternative third-party provider to hold client money.
However, the Law Society said it would be ‘prohibitively expensive’ for firms to use third parties, with the costs of running client accounts still ‘significantly lower than those of the BARCO model’.
A spokesman for BARCO told the Gazette that it did not dispute that its current pricing strategy is likely to price out conveyancers.
But he said the Bar Council is now re-evaluating its pricing structure to make it ‘affordable and attractive’ to solicitors and their clients. New tariffs could be in place as early as September.
Paul Mosson, director of services for the Bar Council, said when BARCO was first designed, it primarily had barristers in mind. The fee structure was therefore designed to suit that market.
He added: ‘The market within which BARCO operates has evolved and BARCO has evolved with it. BARCO is not only assessing pricing but it is also adjusting its service levels in order for it to be in a position to work with conveyancers should the need arise. It is BARCO’s mission to be the legal escrow account service of choice for legal professionals.’
Not surprisingly, the Bar Council’s own response to the SRA’s proposals, published this week, is supportive of approving third-party managed accounts.
The organisation said the SRA should set a minimum set of safeguards rather than consider applications from law firms on a case-by-case basis.
‘One of the highest risks to consumers of legal services is the operation of solicitor client accounts,’ said the bar’s response.
‘The approval of third-party managed accounts will allow solicitors to lower their insurable risk and to provide a more secure and transparent service to their clients.’