Helping our members meet challenges
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The legal sector is facing more serious challenges than ever before. Impending changes to the regulatory framework, the economic downturn and the increasing scrutiny of the profession have made it a difficult year for many of our members. The Law Society supports solicitors through the challenges they face, representing the views of the profession to regulatory bodies and pushing for better outcomes on key issues such as professional indemnity insurance and the Code of Conduct.
Anti-money laundering compliance
Anti-money laundering (AML) compliance requirements remain at the forefront of our members' concerns. The Law Society's AML practice note receives over 3000 views a month, while our practice advice service receives around 600 money laundering compliance queries each month. Our bi-monthly AML email has strong readership within the legal profession, as well as with law enforcement, academia and governments around the world.
With changes being proposed to AML requirements by the Financial Action Taskforce and a fourth directive on money laundering being considered by the European Commission, we are working with government policy makers to help them understand the challenges faced by the profession. We aim to ensure that the AML obligations remain effective but are also more workable for solicitors and others who need to meet AML requirements.
How we've helped our members this year
- We launched our complete Introduction to AML, an online training package for new money laundering reporting officers and their deputies.
- We run 32 money laundering reporting officer (MLRO) networking groups and 40 AML training sessions around England and Wales each year, training over 1900 solicitors on AML compliance through these events, with an average satisfaction rating of 95 per cent by attendees.
- Our third AML annual conference in June 2011 focused on embedding compliance into everyday practice.
Professional indemnity insurance
In 2010/11 the Law Society continued its work on professional indemnity insurance (PII) issues, pushing for a more competitive market to ensure all solicitors can afford PII.
- We persuaded the SRA not to withdraw cover for lenders, which would have had a devastating effect on small conveyancing firms.
- We successfully lobbied the SRA to change its approach to the Assigned Risks Pool (ARP) and adopt our alternative approach of an extended policy period.
- We support the SRA's funding proposals for ARP from 2012 so long as the SRA is transparent about its ARP management strategy and is open to suggestions about how to better control and manage firms.
- We believe that layering of liability (with insurers being responsible for the unlimited layer) represents the best available outcome. If we don't support this approach we believe the SRA will levy the profession for the entire cost from 2012.
Outcomes-focused regulation
The Solicitors Regulation Authority's (SRA) new approach to regulating, outcomes-focused regulation (OFR), will come into effect from 6 October 2011. OFR is a move away from a rules-based approach, focusing on high-level outcomes governing practice and the quality of outcomes for clients.
We have worked closely with the SRA over the past year on the development of the new regulatory system, and represented the best interests of the profession in the development of the SRA's new Code of Conduct, particularly focusing on ensuring the conflict rules in the Code fulfil their purpose.
Alternative business structures
The alternative business structure (ABS) is a key issue for many solicitors in England and Wales. From 6 October 2011, for the first time it will be possible for non-lawyers to manage or own legal practices. This presents both challenges and opportunities for the profession, with many firms weighing up the benefits and risks of becoming an ABS.
The Law Society provides thought leadership for firms on the forthcoming ABS system. This year we held a regulation conference on ABSs and OFR, to inform solicitors about the impending changes and the guidance and tools we're developing to assist the profession.
Attendees benefitted from the knowledge and insight of speakers including Jonathon Djanogly MP, parliamentary under-secretary at the Ministry of Justice.
Similar events were also held in Leeds and Bristol.
Quality assurance for solicitor advocates
The Law Society has responded robustly to proposals for a quality assurance scheme for criminal advocates. It looks likely that the scheme, which is being developed by the three regulators (the SRA, Bar Standards Board and ILEX), will come into being at the start of the 2012.
The Law Society seeks to ensure that the scheme does not disadvantage solicitor advocates. In 2010/11 the Law Society conducted a review of our support for solicitor advocates. The recommendations from this review include a membership scheme for solicitor advocates, focused on providing training to improve and develop advocacy skills. A membership scheme for solicitor advocates is on track for launch in autumn 2011.