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SRA Investigations: what to do when faced with an SRA investigation?

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SRA Investigations and SDT Proceedings are stressful, time-consuming and in some cases, fatal to a solicitor or firm.

As any solicitor will know, the Solicitors Regulation Authority – the SRA – are responsible for regulating solicitors (and the staff that work within law firms).

All solicitors are expected to comply with the SRA’s Regulatory Framework which is spread across a number of of regulations and rules, including the Principles, Codes of Conduct and the Solicitors Accounts Rules.

These investigations can cause untold damage to the reputation of a solicitor or a firm; they are unwelcome and stressful.

Saunders Law has acted and advised on some of the most high-profile and complex SRA investigations – including those involving a solicitor linked to the phone hacking scandal and the Leveson Inquiry and right up to the Solicitors Disciplinary Tribunal and beyond.

How does an investigation begin?

The SRA will investigate when it suspects misconduct – a breach of the SRA’s rules – or when misconduct is reported to it.

Normally, the SRA’s investigation will begin by way of letter – giving the firm or solicitor involved the opportunity to respond to the allegations and setting out the evidence.

The SRA will normally request a position statement and it has wide powers to compel third parties – including clients, counsel, banks or accountants – to provide them with information.

What is the best way to respond to an SRA investigation letter?

Swiftly and in a considered fashion and with the benefit of legal advice.

In our experience, solicitors and firms lack the objectivity to see the wood from the trees and rarely have the detailed skilling and strategic insight to respond in the best possible way to an SRA investigation letter.

The response is very important.   It sets the tone for the entire investigation and can show that a solicitor or firm is taking this matter seriously, is professional and is well-prepared to defend its position.   A well-drafted response, supported by evidence, may end an investigation and avoid an escalation to the Solicitors Disciplinary Tribunal.

Our expert regulatory and professional discipline lawyers have on numerous occasions succeeded in avoiding referrals to the Solicitors Disciplinary Tribunal but it is important to remember that any correspondence with the SRA can be put before the Solicitors Disciplinary Tribunal, if this matter escalates.

Do I have to respond to an SRA investigation letter?

Yes.   A firm or solicitor has a specific duty to engage with the SRA.   The solicitor or firm may be committing a separate regulatory offence, by not properly engaging.

What other powers does the SRA have?

Depending on the seriousness or the nature of the allegations, the SRA could:

  1. Put the firm on notice of a Forensic Investigation – or attend unannounced – where a Forensic Investigation Officer from the SRA will conduct a live investigation within the firm
  2. Compel a solicitor or members of a firm to attend an interview, conducted by an investigating officer at the SRA. This is often a serious development and suggestive of serious misconduct.   Similar to a police interview under caution, whatever is said can be used against a solicitor before the SDT and inference can be drawn from silence.
  3. In the most serious of cases, the SRA can intervene in a firm, if it has serious concerns that the firm is endangering clients’ interests or client money, under the Solicitors Act 1974.

What happens after a solicitor or firm has responded to an SRA investigation letter?

The SRA will review the letter – sometimes known as a letter of representations – and decide (usually as part of panel) what action to take.   The SRA has a number of ways in which it can dispose of an investigation.   It could:

  1. Conclude that there was no case to answer and make no finding of misconduct
  2. Conclude that there was no finding of misconduct but offer guidance or advice on what the solicitor or firm should do in the future
  3. Issue a warning, a rebuke or a reprimand – all of which remain on a solicitor and firm’s record and could have serious consequences
  4. Issue a fine up to £2,000
  5. Refer the matter to the Solicitors Disciplinary Tribunal

Our recent work involving the SRA and the SDT

Advising RB – This is a matter is of exceptional importance, as it is the first matter known to this firm, where a solicitor accused of dishonesty, was found to have been suffering from such significant cognitive impairment, as to negate a finding of dishonesty - avoiding strike-off.   It is difficult to underplay the significance of this matter, which saw the SRA, in the face of medical evidence, withdraw (after SDT approval) the allegation of dishonesty against RB.

Advising JS - JS was accused by the SRA of holding himself out as a solicitor, when in fact he was a student member of CILEx.   A serious matter, he was said to have also mislead a High Court Judge as to his status in pleadings, by representing himself as a “lawyer” and by signing documents on behalf of his firm.   This case reflects a growing trend within the SRA, to bring regulatory proceedings against (seemingly) anyone who provides legal advice and isn’t absolutely explicit in describing their status.  After extensive correspondence and negotiation, conducted by reference to a number of higher court authorities and by quoting the CPR (!) this matter was finally resolved when the SRA discontinued their investigation. Thankfully, JS is now working as a caseworker for a national law firm.

Advising EF – EF was accused of not appropriately describing her status as a member of CILEx and leading clients to believe that she was a qualified solicitor, following complaints from members of the public.   She faced a dual investigation by both CILEx and the SRA and was also accused of destroying documentation and thereby frustrating a major immigration appeal which rendered this matter particularly serious.   EF was also newly engaged at an international bank so the repercussions on her were very serious.  Another fact-heavy case, where the SRA alleged a significant number of breaches of the Handbook, supported by extensive written evidence from the client in question, leading to the SRA discontinuing their investigation.

Our team

Our team is led by Matthew Purcell and James Saunders, assisted by a multi-disciplinary team of associates across the firm's commercial litigation, human rights and regulatory teams.   Matthew Purcell and James Saunders are members of the Solicitors Assistance Scheme and The Association of Regulatory and Disciplinary Lawyers.

We will always offer you a free, no-obligation appraisal and discussion of your options and a strategic plan to help you decide if we are the right firm for you or your practice.

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