No decision on will-writer regulation until 2012

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By Legal Futures

8 December 2010

Edmonds: LSB moving on to identifying gaps in the market

A decision by the Legal Services Board (LSB) on whether will-writing should become a regulated activity will not be made until 2012, it emerged today.

The LSB’s draft business plan 2011/12, published today for consultation, revealed that the board is also considering what it calls a “deep dive” investigation of conveyancing due to the high number of negligence claims and evidence of rising levels of fraud across conveyancing-related industries.

Launching the business plan, LSB chairman David Edmonds said the bulk of regulatory structures are now in place and the next phase of delivery would involve “identifying gaps in the market and protecting the consumer interest”.

Although the plan’s introduction says it has an “early focus” on “the most appropriate approach to regulating will-writing services”, it does not expect to receive advice on the subject from its consumer panel until the third quarter of 2011. The LSB will then “potentially” investigate whether to ask the Lord Chancellor to make will writing a reserved activity under section 24 of the Legal Services Act 2007 in the following quarter.

Next, a consultation on the results of its investigation is scheduled for the period January to March 2012, after which the responses will have to be considered before a decision is made and action taken.

The LSB has expedited consideration of will-writing ahead of a general review of the whole issue of reserved activities. In September the level of “external interest creates an impetus to consider more urgently will-writing in its own right”.

As far back as April 2009 the LSB said it would invite the consumer panel to explore “the consumer impact of apparent gaps in the regulatory system, for example in relation to will writing”, although funding for the panel’s investigation was not found until November this year. The LSB and the panel both agree that original consumer research is needed to build a clear picture of what is currently happening in practice.

The investigation into conveyancing is one of five potential reviews of areas in which the LSB believes it may have to “respond to risk”. The others are disciplinary rules, enforcement and appeals, referral fees, smaller approved regulators and immigration.

It said several conditions “suggest strongly that a review of conveyancing is warranted”, including “the number of claims against the various client protection mechanisms” and anecdotal evidence of rising levels of fraud “across a number of industries”.

Major milestones for LSB activity in the plan include completing preparations for alternative business structures (ABSs), with the emergence of fully operational licensing authorities in the sector and the first ABSs able to begin on 6 October 2011. The LSB’s plans to make law firms and chambers publish information about the diversity of their staff may start in the second half of 2011 after it agrees action plans with the frontline regulators.

Other work of note include plans to “risk rate” the regulators the LSB oversees to determine the level of ongoing supervision needed, to ask the consumer panel to advice on criteria for accreditation schemes, and to agree a framework for extending quality assurance for advocates into other areas after the crime scheme launches next year.

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