Consumers and firms to benefit as SRA reconsiders closure of SIF
The SRA previously indicated it would prefer to close SIF, claiming the cost of running it was disproportionate to the consumer benefit it delivers.
We campaigned strongly for the continuation of SIF, arguing closure would leave consumers unable to seek redress on the rare occasion something goes wrong.
The absence of widely available, reasonably priced, commercially provided alternative insurance could have left former principals of closed firms personally liable for claims.
“We are delighted the SRA has listened to our concerns about closing SIF and has instead given the fund another chance,” said Law Society president I. Stephanie Boyce.
“The SRA has heard our arguments about the importance of continuing consumer protection, rather than run the risks of not doing so, which would leave consumers unable to claim compensation for flawed transactions.”
The SRA will not make any decisions about SIF’s future in the lead up to September 2023 while it looks at whether consumer protection can be delivered in a more cost-effective way.
Possible alternatives to SIF include:
- changing how the fund is set up and operated, reducing the scope of protection it gives
- finding a different consumer protection vehicle funded via SIF’s surplus, which may also be subsidised by the profession
We stand ready to support the SRA as it explores further options.