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SRA produces inducements guidance note

The Solicitors Regulation Authority (SRA) has produced a guidance note to ensure the profession stays on the right side of the Code of Conduct when offering inducements to potential clients.

The note has been prepared by the SRA in light of restrictions introduced by the Government on the way claims management companies (CMCs) can advertise. The Ministry of Justice (MoJ) has banned CMCs from offering inducements, a move first mooted when Lord Young was commissioned to conduct a review of the operation of health and safety law and the growth of a perceived “compensation culture”.

Lord Young's report highlighted, among other matters, a risk to clients if inducements continued to be allowed. The MoJ therefore introduced a ban at the end of April.

However, there's no evidence to suggest that similar activity by those regulated by the SRA has any adverse effect on clients, so the SRA will not be following suit. To ensure this remains the case, the guidance note has been issued to remind those in the legal profession of the relevant contents of the Code of Conduct dealing with inducements, such as Chapter 8 (Publicity).

The note reiterates the Mandatory Outcomes and Indicative Behaviours set out in the SRA Handbook, and was approved by the Authority's Standards Committee in May.

Agnieszka Scott, SRA Director of Policy, said: "We understand that the MoJ has reacted to the findings of Lord Young's report, particularly when it comes to offering inducements in advertising. We have often been asked to look at similar measures for solicitors, but we have not found anything to suggest that it is a significant problem or that clients' interests are put at risk.

"We have no evidence which suggests that inducements encourage spurious claims to be made. We want this situation to continue.

"The Guidance Note has been produced to remind solicitors of their obligations as they look to promote themselves and attract new business - remembering that their publicity should not be inaccurate or misleading and that clients do not suffer. We will be monitoring this position, and if we become aware of any further evidence of increased risk to consumers, we will review the situation."

The Guidance Note refers to the Mandatory Outcomes and Indicative Behaviours outlined in the Code of Conduct which are relevant in these circumstances.

Go to the Guidance Note

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