The SRA’s Standards and Regulations 2019.
Whilst our own FCA’s regulations might be quite precise, and the ICAEW’s (as you might expect,) can be too, the Solicitor’s Regulation Authority opted, in 2019, for a slimmed down set of ‘Standards and Regulations’ governed by a more concise set of 7 Principles.
Your regulator wishes to encourage individual professionalism within clear parameters, prompted by both the guiding principles and the newly introduced Firm Code of Conduct. It is the firm’s responsibility, primarily that of the Compliance Officer for Legal Practice to introduce processes to facilitate and direct the individual professionalism and high standards.
It might be interesting therefore, to consider if and how the governing principles might influence firm and individual lawyer behaviour, in the context of third-parry referral:
You act:
in a way that upholds the constitutional principle of the rule of law, and the proper administration of justice. – This is just what we would all expect and do expect from the legal profession.
in a way that upholds public trust and confidence in the solicitors’ profession and in legal services provided by authorised persons. – As a client, when seeking professional advice from a solicitor, I would hope and trust that, if they feel there is ancillary advise needed from a fellow professional, they will highlight this to me.
with independence. – The SRA would find it hard to believe that all third-party referrals would go to the same referee. As with the legal profession, both financial planning and accountancy firms will have specialisms and expertise in different areas, so a preferred list of third parties based on client needs might be suitable.
with honesty. – As with trust, a client must expect honesty from their legal adviser, in advising them that they need complementary advice from another professional, in relation to their issue or problem.
with integrity. – If a solicitor identifies the need for complementary advice from another third-party and does not suggest an appropriate professional adviser, can they be said to be acting with integrity? Not recommending a third-party approved by the firm should not be an option.
in a way that encourages equality, diversity and inclusion. – Whilst this is a constant theme for the regulator it may not directly influence a choice of third-party, although it could.
in the best interests of each client. – This is of course the most important of the 7 principles when it comes to third-party referral, and it must run through all decisions made by the solicitor form and its individual lawyers.
Best Practice under the rules.
The question that MUST always be uppermost in any referral or recommendation process that takes a solicitors’ client away from them to a third-party, be it financial planner or accountant, is HOW CAN WE/I DEMONSTRATE WHY WE ARE CONVINCED THAT THIS REFERRAL IS IN THEIR BEST INTERESTS?
The answer of course, is thorough and transparent due diligence, conducted, recorded, regularly reviewed and demonstrating best interests, to clients, but importantly, also to the SRA. The answer is not, and should never have been, the proffering of 3 business cards, leaving a client to decide which third-party suits them. The latter should no be considered a professional referral, and it would be difficult to suggest such an abdication of responsibility would be in the client’s best interests. In addition, it will not sit comfortably within a firm-wide process, as required by the SRA since 2019.
Matrix Capital – A Safe pair of hands.
For clients in vulnerable circumstances, for those inheriting wealth, and for those seeking to efficiently plan for a comfortable later life, whilst also securing a tax efficient legacy for dependents, Matrix Capital is an experienced, empathetic and highly qualified safe pair of hands for your referrals.
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