The Law Society is set for a dispute with the Solicitors Regulation Authority over the regulator’s attempt to increase its fining powers.
The SRA has invited comments on plans to increase the maximum fine for ‘traditional’ firms from the current £2,000 to as much as £100,000.
The consultation ends next month, but the Gazette understands that the Society is set to vehemently oppose any increase because of doubts about the transparency of the enforcement process.
A Society spokesman said: ‘We share the Legal Services Board’s concerns about the functioning of the enforcement team within the SRA. There continues to be a lack of transparency about the operation of the enforcement team which makes it impossible for the Law Society to support any increase in the powers available to it.’
The regulator has said it wants to extend its fining powers to prevent so many cases ending up at the Solicitors Disciplinary Tribunal, thus around £8,000 per case in legal costs. Higher fine limits would also reduce the disparity between law firms and alternative business structures, which can be fined up to £250m according to the terms of the Legal Services Act.
By increasing the number of cases it deals with, the SRA suggests disciplinary matters would be resolved an average of 10 months more quickly, saving around £8,000 per case in legal costs.
The authority also wants to end the risk of ‘perceived absurdity and unfairness’ in the lack of consistency with how alternative business structures are treated.
‘We are considerably limited in the scope of matters which can be dealt with without a prosecution before the SDT,’ said the consultation paper.
‘The current regime fails to take advantage of the fact that a considerably quicker, cheaper and more proportionate regime for levying fines against law firms is already in place for ABSs.’
The SRA had previously said in its consultation paper that the Law Society had indicated it ‘may not object to some degree of increase’. The SRA also believed the LSB supported the proposal for an increase to a commensurate level between law firms and ABSs.