Codes of Conduct and SRA Accounts Rules

SRA Compliance

At the Strategic Partner, we regularly provide training to law firms and their staff on the Codes of Conduct and SRA Accounts Rules. We also operate a COFA service alongside firm compliance where we manage the compliance registers including giving advice and guidance on reports and notifications.

One of the questions we often get asked is what information should be reported to COFAs. To assist firms and their staff in deciding what to report we have prepared a list of issues that should be reported or reports we tend to receive. To download this article in PDF: please click on the link below:

What to Report

This list included typical issues that should be reported to the COFA. Many of these will only be relevant to the accounts team but as will be seen, there are a few suggestions that will be firm-wide. It has to be remembered that the duty to report a matter to the COFA applies to everyone and if an issue is noted it is the individual’s responsibility to report this to the COFA as quickly as possible and not to leave it or ignore it. This could land both yourself and your COFA in difficulty: –

1. Overdrawing the client account for any reason even by 1p (this includes payments or transfers)
2. Sending money from the office OR client account to the incorrect person or bank account
3. Duplicate payments issues from either the office or client account
4. Late payment of any client related disbursement in particular SDLT
5. Any complaint about anything financial whether relating to non-payment of bills, missing cheques, etc.
6. Any client balance on a matter that is over 90 days old
7. Any matter where a client is not prepared to send account details to make a transfer of monies held on the client account
8. Any entry error on the accounts system (office or client money)
9. Unpresented cheques over 6 months old
10. Any request to send money to charity (regardless of amount)
11. Any matter where you have drawn from the client account without written notice being sent to the client in advance
12. Any fines or penalties applied to the firm whether a client matter or not.
13. Any unpaid bills that are older than 90 days
14. Client account reconciliation not completed for any given month
15. Any request for compensation for any reason
16. Any correspondence from the Bank or any other lender
17. Any correspondence disputing fees or requesting a reduction in fees
18. Any claims forms issues against the firm or any letters threatening proceedings of any kind
19. Bailiff’s arriving at the firm or threats or bailiff’s arriving
20. Anything you see which you think could be dishonest action by another member of staff
21. Loss of any financial data for both the firm or a client
22. Theft of any data which included financial information about the firm or a client (including account details)
23. Sending account details of the firm to the wrong person.
24. Any email or call that you are suspicious about and may be fraud.

It is important for all staff to note that reporting a matter to the COFA is the equivalent of making a report to the SRA and therefore fulfils your personal notification obligations.

When to Report

The answer to this one is simple – Immediately on the discovery, do not delay as it could prejudice an investigation.

The Investigation

To finish this article we should also guide the COFA on what you consider when a report is made, the list is as follows: –

1. Was the breach caused due to delay, error, or negligence?
2. Was the breach an innocent mistake or was it deliberate?
3. Was the report made promptly?
4. Was the breach an isolated incident or a series of incidents?
5. How much money is involved or how severe is the problem?
6. Was there any loss to the client or any other party?
7. Could the breach have been easily avoided?
8. Does a report need to be made to the SRA?

Deciding on a report to the SRA can become a complex area and importantly getting things wrong can lead to consequences for failure to notify the SRA of a matter which they later decide was reportable.

Our SRA Compliance Services

At The Strategic Partner, we work with firms and their COLPs and COFAs to assist them with the management of risk, compliance and regulation through our two compliance solutions or we can provide individual training and guidance.

We always provide bespoke services as we recognise that every law firm is different. It is essential to provide guidance, consultancy, written documents, training and procedures that meet the exact requirement of the firm to overcome rather than provision templated solutions.

For more information about our Risk, Regulation & Compliance Services, you can call us on 0203 911 9710 or you can email us at info@thestrategicpartner.co.uk. Links to our brochures are as follows:-

• Regulation & Compliance Services including AML

• Compliance Administration