SRA seeks power to launch “spot checks” of law firms

Philip: 48 outstanding SLAPPs cases

The Solicitors Regulation Authority (SRA) has called for the power to launch “wide-sweeping inspections” of law firms without needing the trigger of a specific allegation of misconduct.

Chief executive Paul Philip made the request while revealing that the first two cases involving alleged SLAPPs (strategic lawsuits against public participation) have been referred to the Solicitors Disciplinary Tribunal (SDT).

Mr Philip was giving evidence to the House of Lords communications committee, which was taking evidence on the progress made on combatting SLAPPs.

He said the regulator had two legislative asks: new powers to issue unlimited fines, which has been a request for some years, and to make spot checks.

It came in the context of questions about the SRA’s two thematic reviews on SLAPPs, the second of which was only published last month.

These involved visits to multiple law firms but Mr Philip stressed that thematic reviews were “an opportunity to highlight good practice and… sharp practice” – they were not inspections of those firms, although any potential misconduct the SRA came across would be referred for investigation.

“We don’t have the statutory powers to do a spot check or an inspection other than in anti-money laundering work,” Mr Philip explained.

“So in terms of asks, we would very much like to do spot checks or inspections of firms across the board but at the moment we need a very specific trigger in relation to an allegation of misconduct to do that.

“For instance, if you were to say that Snooks & Co were really bad at X or Y, we can’t just suddenly go in and look at all of Snooks & Co’s work – we would need a very specific allegation in relation to a core set of facts.”

A new power would “allow wide-sweeping inspections of law firms and would give us more information to feed our specific investigation work”, he went on.

Asked why the thematic reviews had excluded firms facing complaints the SRA was investigating, Mr Philip said: We do not want to prejudice the investigation that’s taking place. It would be quite easy for us to be accused of being inappropriate or going on fishing expeditions or [of being] biased against individual lawyers or law firms…

“If we had the statutory authority to do spot checks, we would most definitely do that in those cases. But, because we don’t, we’ve taken the view, rightly or wrongly, to keep them separate for the time being.”

He said the SRA has received a total of 71 reports around SLAPPs to date, up from 40 when he gave evidence in January 2023.

It has closed 23 with no further action while the rest were still live. Two cases have been referred to the SDT and are awaiting certification by the tribunal – usually a routine step. The details of the allegations will then be published, probably by the end of the month. A further two or three cases were likely to be referred soon.

Mr Philip said the SRA was “probably as frustrated as anyone else” about how long it has taken to reach this point but described them as “novel and complex” matters which the SRA was treating as test cases.

As a result, it wanted to ensure those involved had enough time to make representations and not have any basis to challenge their prosecution on procedural grounds. The hope was that future cases would be processed more quickly.

“We are challenged consistently at every point of our process – that’s just the norm, not just in relation to SLAPPs,” he added.

Earlier in the session, various speakers praised the SRA’s work on SLAPPs and particularly the warning notice it issued in November 2022, which is to be updated following the recent thematic review.

Solicitor Sayra Tekin, director of legal at the News Media Association, said the SRA was “going in the right direction”, with the warning notice making “a real difference”.

She and others criticised the SLAPPs Bill currently going through Parliament for not being strong enough to stop cases and Ms Tekin said the SRA was setting higher standards than the government was via the bill.

“I have it first-hand from officials at the Ministry of Justice that they are trying to balance the interest of claimant lawyers against SLAPP victims, which seems to be entirely the wrong starting point,” she said.

Susan Coughtrie, director of the Foreign Policy Centre, a think tank, agreed that the warning notice has had an impact, particularly on the use of labels on correspondence such as ‘private and confidential’ aimed at stopping recipients from sharing them.

But she had heard complaints from those who had made reports to the SRA that they were “unhappy with the resolution”, while other cases had been going on “for the best part of two years”.

Veteran media lawyer David Hooper backed an increase in the SRA’s fining powers. “That’s what’s going to make real changes,” he predicted.

    Readers Comments

  • David Gale says:

    I’m not reassured that an already politicised regulator wouldn’t abuse the proposed capability. Perhaps spot checks ought to be performed on the SRA, particularly when it selectively ‘loses’ key records that evidence its own nefarious activity.

  • KM says:

    SRA should have power like this otherwise it will be very tough to touch those are involved with fraudulent by naming of solicitors, remember they are very tricky and clever.

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