Client account interest – compliance, risk and proposed reforms

Rising interest rates have created significant income for law firms. In 2023, client account interest income rose by over 1,000% compared to 2022. For some firms, this income now represents more than 10% of turnover.

High interest rates have also triggered regulatory and political scrutiny. This session covers the current rules, where the SRA and Government are heading, and your responsibilities.

Topics covered include:

• The current rule: What Rule 7 of the SRA Accounts Rules requires and how “fair and reasonable” interest is interpreted.
• The interest landscape: How rising rates have changed the financial picture for firms and created regulatory concern.
• The outside risks from the Solicitors Regulation Authority and the Government.
• Your compliance risks: What the SRA expects from you now and how to prepare for possible change.
• The rules on client account interest are in flux. This is a state-of-play review to enable you to plan for the various risks ahead.