Closed Consultation

Reporting concerns

7 February 2019

Next steps

Executive summary

  • 1.

    Everyone wants to be able to trust that solicitors will behave in the right way and meet the high standards we set. If solicitors fall short, we step in to protect the public.

  • 2.

    It is important that firms let us know about potential breaches of our rules promptly. We may have additional information and may need to use our powers and take steps to protect the public.

  • 3.

    We also need others to alert us when things go wrong. The public, clients and judiciary, for instance, all play a role and regularly report to us. And so do law firms.

  • 4.

    Reporting potential serious breaches goes to the core of the professional principles of trust and integrity. All solicitors and firms have a role in helping maintain trust in the profession.

Why we are consulting

  • 5.

    In recent discussions with firms and individuals around the use of non-disclosure agreements it has become clear that understanding of when their duty to report a potential breach is triggered can differ.

  • 6.

    Some suggest that the obligation to report only arises once they have determined within the firm that regulatory misconduct has indeed occurred. Others believe that they should report any potential breach much earlier.

  • 7.

    We want to make sure there is greater clarity about this issue, so all firms better understand their regulatory obligations over what, and when, they should report.

The aim of our approach

  • 8.

    Our aim is to regulate effectively in the public interest. Prompt reporting of potential serious misconduct enables us to decide:

    • how to investigate an issue most effectively
    • whether early protective action, such as practice conditions, are necessary to protect the public
    • whether there has been serious misconduct.
  • 9.

    We want firms to be clear on what, and when, they should report concerns to us over issues which may lead to regulatory action.

  • 10.

    We also want firms to be clear on when it is appropriate to investigate and resolve routine complaints and concerns by themselves. Reporting issues which would not lead to regulatory action can use up resources and cause unnecessary anxiety for the individuals involved.

  • 11.

    We will work openly and collaboratively with firms so that we are quickly aware of cases that may raise serious concerns, but neither we nor the firms are burdened with regulatory consideration of those allegations that do not.

Clarifying our expectations on reporting concerns

  • 12.

    On an ongoing basis, those we regulate must use their judgement to consider what to report to us, and when. They must consider:

    • what evidence or information is sufficient for them to report a matter
    • at what stage in the process they should inform us
    • what, if proven, could give rise to regulatory action.
  • 13.

    The question of what kinds of issues constitute a serious breach which requires reporting are already addressed in our Enforcement Strategy. This consultation does not revisit this issue.

  • 14.

    Instead this consultation focuses on providing clarity around the practical judgements that compliance officers, solicitors and firms must make when deciding when, and if, to report a potential serious breach.

Next steps

  • 15.

    We welcome views from the public, firms and solicitors on our approach and the options set out in our consultation paper.

  • 16.

    We are keen to gather feedback on our analysis of the triggers for reporting serious concerns, on what and when to report to us and on proposed drafting options to update our new Codes of Conduct in these areas. We would also welcome views on where the evidential threshold for reporting to us should lie.

  • 17.

    Subject to the outcome of this consultation, we may make minor changes to the Codes of Conduct to provide further clarification. We will adopt a similar approach to the obligations on firms and individuals, including compliance officers, so there is a consistent test and threshold across the board.

  • 18.

    Before any new Codes come into effect we need approval from the Legal Services Board (LSB). If approved, we expect our new Principles, Codes and Rules to come into effect from April 2019.

Open all
  1. We consulted on a draft strategy in 2017. Following this we made minor amendments as a result of feedback. An updated version will be published in due course following Board approval
  2. At paragraph 2.1(d)
  3. Charging (The Director's Guidance) 2013 - fifth edition, May 2013 (revised arrangements); the Code for Crown Prosecutors, January 2013, paragraph 4.5
  4. See our Guidance
  5. See for example Huda v Wells [2017] EWHC 2553 QB at paras 57 to 67 which provides a recent analysis of the defence of absolute privilege as it applies to referrals to statutory regulatory bodies.
  6. See our Guidance on whistleblowing