The Law Society is to roll-out its new ‘safe-harbour’ compliance initiative to the whole profession, providing advice to COLPs and COFAs via its Risk and Compliance Service.

The move follows the Society’s launch earlier this month of the Compliance Reference Group (CRG) pilot to enable Compliance Officers of Legal Practice (COLPs) from the top 100 firms to submit enquiries to the Law Society on regulatory issues. Plans to extend that scheme to Compliance Officers for Finance and Administration (COFAs) are well advanced.

Now the Society is offering the service to all firms via the Risk and Compliance Service. In both initiatives, if an individual or firm follows advice from the CRG or Risk & Compliance Service and subsequently finds that action is being considered or taken against them by the Solicitors Regulation Authority, the Law Society will stand by that individual or firm.

Law Society chief executive Desmond Hudson said: “The expertise of our practitioners in our Risk and Compliance Service should be made use of by all the profession. There is clearly a demand for it. Both schemes harness the “wisdom of the profession” to equip individuals with advice and support to help compliance.

“The compliance community who are members of the Risk and Compliance Service will be able to benefit from the same level of support that the top 100 firms within the Compliance Reference Group receive. This new initiative enables that to happen.”

Risk and Compliance Service members who are COLPs or COFAs will be able to submit queries to the Service, which will then be considered by Law Society regulatory compliance experts, together with a panel made up of practitioners. The Society says that measures are in place to ensure consistency between the advice given by both the CRG and the new Risk & Compliance Service initiative.

This latest service is in addition to a range of guidance and support to members on outcomes focused regulation and wider compliance issues including practice notes, online training, diagnostic visits and more.

The new service is due to go live on May 8 2012.

Find out more about the Law Society’s Risk & Compliance Service

The SRA has published a report on the potential impact of removing the minimum training salary.

In producing this document, they have explored, in particular,

• the effect on salary levels and numbers of training contracts provided, and
• access to the profession and impact on equality and diversity.

BLS would encourage you to send your comments on this impact assessment to trainingconsultations@sra.org.uk by 11 May 2012.

The report, together with the comments the SRA receives, will be presented to the SRA Board at its meeting on 16 May 2012 as part of the board’s discussions on the minimum salary for trainee solicitors.

The report is 123 pages long and as part of its findings shows that a large percentage of training contracts are already at a salary in excess of the minimum salary.

The Co-operative Bank has launched a new online banking service specially designed to help legal firms manage money on behalf of clients.

Financial Manager is a customer money management package that makes the day-to-day running of client money simple.  It has been developed for businesses such as those in the legal sector.

The benefits include:

·        Access to an unlimited number of virtual accounts which can be easily grouped together, such as by individual, company or property name.

·        Facility to allocate account names and references so that they can be matched simply to those on company records for reconciliation.

·        Make and receive payments or issue cheques against each virtual account.

·        Potential to generate income by pooling funds held in accounts to take advantage of higher rates of credit interest available on larger balances; and an option to set varying interest rates on virtual accounts.

·        Facility to generate custom reports.

Dave Matkin, Head of Corporate Business Development, at The Co-operative Bank said “Financial Manager is an online complete end-to-end customer money management package that gives the company full control over its clients’ money.

“It allows legal firms to segregate client funds easily and efficiently, to complete reconciliation, reduce staff costs and time, and improve the service they provide to their customers.

“Despite the economic uncertainty of the last few years, this is another illustration of how we continue to expand our support for businesses and offer a compelling alternative to the traditional providers.

“As part of The Co-operative Group we’re in the unique position of being able to offer business customers access to a broader range of services and expertise spanning sectors from legal services to pharmaceutical care.”

Financial Manager is also encrypted providing full security for customers along with secure login facilities, and complies with Financial Service Authority (FSA) money rules.

The Governors of The College of Law have undertaken a comprehensive Strategic Review. As a result of this, the College’s legal education and training business is being separated from its on-going charitable activities. The Governors have agreed the sale of the legal education and training business, which will continue to be known as The College of Law, to leading European private equity firm Montagu Private Equity under the terms of a conditional agreement. One branch of the College of Law is based in Bristol.

The proceeds of the sale will create a significant fund of approximately £200 million with which the charity – set to be renamed The Legal Education Foundation – will further its charitable object to promote the advancement of legal education and the study of law for future generations of students. This will be achieved via bursaries, scholarships and grants. The Legal Education Foundation will be one of the largest independent educational charities in the UK.

Montagu Private Equity is one of Europe’s leading private equity firms. Montagu Private Equity will acquire the entire legal education and training operations of the College related staff, and contractual commitments with law firms, as well as “The College of Law” brand and the professional accreditations and Taught Degree Awarding Powers. The College of Law will continue to award its existing qualifications and seamlessly maintain the operation of the College for all clients, students and staff. Montagu Private Equity is supporting the existing management team, led by Nigel Savage, and the staff of the College.

In addition to supporting the continuity of existing business operations and teaching activities, Montagu Private Equity is committing to establish a College Scholarship Fund with an investment of £2 million for the benefit of the College’s students and will also place 2% of the fully diluted share capital in the ultimate holding company of Montagu Private Equity, as at completion of the sale, into the scholarship fund.

The College of Law is sure that this will mean that it is even better placed to focus on providing legal education of the highest standards. The College’s business, people, centres and services will remain unchanged in the short term and, over the medium term, will be enhanced as a result of these plans for the future development of the business.

The Legal Services Board has announced proposals in April to deliver greater protection to consumers of the legal services of will-writing and estate administration. These would see the services brought within the scope of legal services regulation, regardless of who provides them.

The decision on whether or not to regulate will-writing and estate administration services has long been debated. In line with its statutory responsibilities, the LSB has reviewed all of the available evidence about the problems suffered by some consumers in these areas, and conducted original research, to identify what the risks to consumers are and why they emerge.

The LSB‟s investigations found systemic problems with the services delivered by many different types of provider. We found consistent patterns of sloppiness, simple errors and poor communication. This often resulted in an unacceptable service. Too often consumers were subjected to unfair sales practices. There have also been well- documented examples of fraud and deception.

The proposals would, for the first time, see all providers of these services regulated and brought within the list of „reserved activities‟. This means that:

• everyone who provides services in these areas will be regulated; a variety of different types of providers will continue to be allowed to operate; and the regulation of those already providing regulated advice will be improved.

The Law Society has welcomed an assurance from the Home Office that police should make it clear to any suspect who speaks voluntarily to the police, that free legal advice is available to him or her at any place, and not just at a police station.

The Law Society was concerned that police interviews were increasingly taking place at the suspect’s home in order to avoid the need for the police to advise the person of the right to legal advice. The Society had written to the Home Office to outline its unease, following a number of reports.

Law Society’s concerns about this issue have now been eased following agreement by the Home Office to propose an amendment to Code C, made under the Police and Criminal Evidence Act 1984 (PACE), which will soon be tabled in parliament.

The Code will make clear that free legal advice is available under the Legal Services Commission duty solicitor scheme  for any suspect volunteering to speak to the police (i.e. who has not been arrested) at any place, not just at police stations, and that police should inform such people of this. The Home Office issued last week the proposed amendment, which is likely to be included in the next tranche of PACE Code amendments

Law Society President John Wotton said; “We are very pleased that the Home Office has taken on board our concerns.  The right of access to legal advice for those suspected of a criminal offence is one of the most important and fundamental rights of a citizen, and should not depend on whether the suspect is present at the police station or is interviewed elsewhere, for example, in their home. Circumvention of this right is not only wrong from the perspective of the rights of the suspect; it is also likely to put at risk the admissibility of any confession that may be obtained in such an interview.’

SRA Executive Director Samantha Barrass has laid out the SRA’s plans for nominating and appointing Compliance Officers for Legal Practice (COLPS) and Compliance Officers for Financial Administration (COFAS).

In a keynote speech delivered at the COLPs and COFAs Conference held at the DeVere Holborn Bars, London, Ms Barrass announced that firms would be able to nominate COLPs and COFAs from 31 May 2012, with a closing date of 31 July. The launch of the form has been delayed to take account of the late start of the PC renewals and recognitions exercise, giving the SRA more time to ensure firms did not experience difficulties with the nominations process.

Firms will be asked to complete a web-based nomination form. The delay also allowed the SRA to reflect on its approach to the COLPs and COFAs’ nomination and approval process.

Fundamental to the SRA’s thinking was how to balance being both proactive and risk-based when regulating a community of 11,000 firms. It needed to consider how best to deploy its resources in support of the delivery of competent and ethical legal services.

Ms Barrass stressed that: “Whilst the vast majority of firms place a great deal of importance on professional ethics and delivery of profession services, others may not have adequately assessed their risks, and how those risks affect their achievement of the regulatory outcomes.

“What this tells us is that a proactive, efficient regulatory regime is one where the primary responsibility for managing compliance risk lies with the firms, with particular responsibilities for the most senior people in firms. It encourages the development of a strong proactive compliance culture in firms by creating a clear formal focus for delivery of the regulatory outcomes in each firm, increasing the chances that the vast majority of firms will identify and deal with regulatory risk.“

This risk-based approach leaves the SRA to focus on those who cannot and/or will not deliver competent and ethical legal services, and on those who are capable and willing but need SRA support to manage particular compliance issues.

The SRA is also keen to stress that whilst COLPs and COFAs are the formal focus points for compliance, they will not be seen as sacrificial lambs. Senior managers will be held to account and will not be able to absolve themselves of their responsibilities. The intention is to create a firm-wide culture of compliance.

The form that firms will be asked to complete will be short but based on binding declarations by both a senior manager with authority to sign on behalf of the firm and the COLP and COFA nominees, for which the signatories will personally be held to account by the SRA. There will also be declarations relating to the Suitability Test.

The form will include:

• confirmation that the firm has suitable arrangements in place to ensure that the COLP and COFA are able to discharge their duties, and
• confirmation that the COLP and COFA declarations, including that the nominee has sufficient seniority and responsibility in the firm, is correct

The SRA will take a risk-based approach to checking nominations, but will go back to a subset of firms largely on a risk basis. It will also conduct some random sampling. Dedicated phone support will be available to firm managers and nominees seeking advice. COLPS and COFAs in Alternative Business Structures will still be subject to a full series of checks to ensure that they work to the same high standards as traditional law firms.

Ms Barrass concluded: “We expect to confirm most COLPS and COFAs by the end of October, consistent with the overall timetable although we may need to accommodate some late approvals of COLPs/COFAs, and we are currently considering this.”

In November last year, the Office for Legal Complaints (OLC), which is the board of the Legal Ombudsman, announced its decision that it is right to publish the names of lawyers in some specific circumstances, in line with the powers given to the Board under the Legal Services Act 2007.

The policy – which starts from 1 April 2012 – is to identify lawyers or law firms that are the subject of complaints in two different ways. The first of these is to publish, once a quarter, a table that summarises the number of ombudsman decisions each legal entity has been the subject of, what the outcome was (so remedy or no remedy), and the area of law in each case. The first quarterly information will be available on the Legal Ombudsman website in late July 2012. The second is where there is a pattern of complaints, or circumstances where it is in the public interest to publish the details of a lawyer or law firm, then, pending approval from the Board, the Legal Ombudsman will publish this information immediately. This is regardless of whether there has been an ombudsman decision on the case.

The House of Lords Constitution Committee has today published its report on Judicial Appointments and concluded that a more diverse judiciary would improve public trust and confidence in the justice system.

The Report includes statistics showing that in 2011 only 5.1% of judges were Black Asian and Minority Ethnic (BAME) and just 22.3% were women. The Committee stressed that diversity incorporates a number of other elements including disability, sexual orientation, legal profession and social background and rejected any notion that those from under-represented groups are less worthy candidates or that a more diverse judiciary would undermine the quality of our judges.

The Committee set out a number of recommendations to improve diversity. These include:

·       The Lord Chancellor and Lord Chief Justice should have a duty to encourage diversity amongst the judiciary as the Judicial Appointments Committee (JAC) does currently.

·       While appointment based on merit is vital and should continue, the Committee supports the application of section 159 of the Equalities Act 2010 to judicial appointments. This would allow the desire to encourage diversity to be a relevant factor where two candidates are found to be of equal merit.

·       Opportunities for flexible working and the taking of career breaks within the judiciary should be made more widely available to encourage applications from women and others with caring responsibilities.

·       There needs to be a greater commitment on the part of the Government, the judiciary and the legal professions to encourage applications for the judiciary from lawyers other than barristers. Being a good barrister is not necessarily the same thing as being a good judge.

·       While the Committee does not currently support the introduction of targets for the number of BAME and women judges, it says this should be looked at again in five years if significant progress has not been made.

The Committee also stresses the importance of the independence of the judiciary and believes that the Lord Chancellor’s role in individual appointments should be limited. It says that his power to reject nominations for posts below the High Court should be transferred to the Lord Chief Justice.

In order to ensure judges continue to have appropriate independence from Parliament, the Committee says that judicial candidates should not be subject to US-style pre or post-appointment parliamentary hearings. Political considerations would undoubtedly influence both the parliamentarians chosen to sit on the panels and the questions put to candidates.

The Committee suggests that a system of formal appraisals should be introduced for judges. They point out this is now common practice in business, the professions and the civil service and would be of benefit to judges, as well as helping to assure the public that the judiciary is of the highest possible quality.