The number of law firms closed down by the Solicitors Regulation Authority (SRA) has fallen to its lowest point for more than a decade, as the impact of the 2008 crash finally recedes, figures released today have shown.
Publishing its annual review for the 12 months to 31 October 2016, the SRA said it closed down 37 firms in the year. In 21 of them, there was suspected dishonesty.
“During and immediately after the recession of 2008, we saw a steep rise in interventions into law firms reliant on residential conveyancing, an area of work badly affected by the economic downturn,” the review said.
“As the economy recovered, the number of interventions of this type, often involving a high number of client files and large amounts of money related to house sales and purchases, decreased. This had an influence on the overall number of interventions.”
At the same time, there was a 42% jump in solicitors struck off at the Solicitors Disciplinary Tribunal (53 to 75), although this was in part explained by a sharp rise in the number of cases brought (96 to 129).
The SRA cautioned that this simply reflected “a full case review” rather than rising misconduct.
Misconduct allegations were upheld in 377 files, nearly two-thirds of which were concluded with a letter of advice.
The SRA is making more use of regulatory settlement agreements to settle conduct matters, agreeing 23 compared to nine and six in the previous two years.
The SRA said that around a quarter of cases that may have ended up at the Solicitors Disciplinary Tribunal are now compromised this way.
In all, the SRA received 11,236 reports concerning solicitors’ or firms’ behaviour. Complaints about incompetence, negligence and delays were the most commonly made about the profession, followed by taking unfair advantage of a non-client, and intentionally misleading the court.
The most reported issues from solicitors themselves were bogus firms and identity theft.
A disciplinary investigation now takes an average of 86 days.
At the same time, more than 30,000 people contacted the SRA’s ethics guidance team, with confidentiality and disclosure the most common issue.
Away from supervision and enforcement matters, the review showed how the amount of time the SRA takes to licence alternative business structures continues to fall, to an average of 69 days in 2015/16.
The SRA received 195,000 calls and 40,000 emails in its contact centre over the year, along with 10m page views on its website, a million of which were views of regulatory and disciplinary decisions on its ‘Check a Solicitor’ pages.
There were 250,000 searches on its ‘law firm search’ facility.
SRA chief executive Paul Philip said: “This review shows we are continually improving how we operate, but of course there is still more for us to do.
“Whether we are making our rules simpler, reforming how solicitors qualify or taking action against the small minority of solicitors who let the profession down, central to our work is a sharp focus on high professional standards.”