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SRA lays out Compensation Arrangements Review schedule

The Solicitors Regulation Authority (SRA) has laid out the schedule for reviewing the SRA Compensation Fund.

The two-year project will look at whether or not the existing compensation arrangements provide an appropriate and effective level of protection for consumers of legal services. The SRA also wants to address any concerns regarding solicitors' compensation arrangements.

A scoping document outlining the process has now been published on the SRA's website. It shows the various stages the Authority will go through to thoroughly research the subject and can be accessed here:

More about the Compensation Arrangements Review

All firms who hold client money contribute to the Compensation Fund, which is to replace money that a client has entrusted to a solicitor in his or her professional capacity, where the solicitor has either misappropriated or has otherwise failed to account for such money.

There will be three phases of the review: the landscaping phase involving analysis of both the SRA's arrangements and the arrangements of other regulators; the research phase that will collect facts and figures on the key issues; and the consultation and report phase where recommendations will be drawn up and put in front of the relevant bodies.

Helen Herniman, SRA Director of Post Enforcement, said: "We are the only frontline regulator that operates such immediate compensation arrangements and solicitors should take pride in the fact that they contribute to such a fund. The majority of solicitors carry out their duties involving client money with the integrity expected, but unfortunately there’s a small percentage which doesn’t and they present a great risk to the public.

"The SRA Compensation Fund allows us to minimise the loss and inconvenience to clients when things go wrong.”

Agnieszka Scott, SRA Director of Policy and Strategy, added: “It's because the fund provides such important protection for clients that we are carrying out this review to ensure that whatever arrangements are in place in the future are appropriate."

Parts of the landscaping phase have already begun, and this stage will last until the spring.

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