We are aware that some lenders are gathering information about firms that are on their panels, including asking for details of client accounts, professional indemnity insurers and copies of letterheads. The Law Society has issued the following advice to solicitors.
Requests for information about your client account
Limit this information to who you bank with, the account number and sort code. Do not send your actual client account statements. Instead you should contact the lender and advise them that to provide this information, or to provide a blanket authority for the lender to obtain information on your client account, would breach the code of conduct.
Requests to contact your professional indemnity insurer
If you receive requests from a lender for blanket authority to contact your professional indemnity insurer (PII) and obtain whatever information they see fit on your PII, you should consider limiting that authority. The Law Society's Conveyancing Quality Scheme (CQS) also asks for information about your insurance, however, it is limited to the firm's policy, schedule for and practice claim history for the last five years. We suggest that following the CQS approach would be considered good practice. If you do need to send information on your claims history, it is important that you redact any client information before you do so, so as not to breach confidentiality.
Furthermore, you should alert your professional indemnity insurer that you have received such a request from a lender and whether they have any requirements or suggestions for the wording to limit that authority.
Requests for a blank letterhead
If you receive requests for copies of a blank letterhead, you should put a cross through it using ink. This is especially important if you are handing this documentation to a third party intermediary and not directly to the bank.
Status of this information
The above advice is Law Society's view of good practice in these situations and it is not the only standard of good practice that solicitors can follow. Further the above advice is not intended to be legal advice nor will following it necessarily provide a defence to complaints of misconduct or of inadequate professional service.
Question of ethics
When should I disclose confidential information? Read the Solicitors Regulation Authority's ethics advice.