New Law Society practice note urges conveyancers to adopt consumer friendly trading practices The Law Society has published a new practice note urging conveyancers to adhere to Consumer Protection Regulations. The news means that conveyancers will have to maintain ‘consumer-friendly’ trading practices. The ‘Consumer Protection from Unfair Trading regulations’ (CPRs) actually came into force in 2008 but recent regulatory changes have now made them potentially relevant to property transactions. As a result the new practice note, published on February 25th 2016, outlines conveyancers’ obligations to consumers in a property transaction which focus on maintaining commercial practices that are fair. Many of the obligations placed on solicitors under the CPRs are already covered by the obligations contained in the SRA Code and, provided that consumers are treated fairly, solicitors are unlikely to be in breach. A recent survey of 5400 consumers, conducted by leading property data and service provider tmgroup in partnership with the Property Academy, the Home Moving Trends identified that 8 out of 10 home movers were looking for their conveyancers to be good communicators and part of ensuring that your firm’s commercial practices are transparent and fair is to offer good communication with clients. Furthermore, consistency in quoting fees for your services to potential clients is vital, with the Quote Conversion Tool from tmgroup being a simple but effective service for conveyancers to help achieve this. Completely free to use, the tool helps firms provide consistent, professional quotes easily to prospective clients and then convert the quote and order searches at the touch of a button. Ben Harris, Sales & Marketing Director at leading property service and data provider tmgroup, said: “This new practice note recognises the need for the conveyancing industry to become more consumer friendly. The recent consumer research we conducted with the Property Academy, Home Moving Trends, revealed that home movers wanted their conveyancers to be good communicators above all else and expectations are higher than ever. Our Quote Conversion Tool has already helped hundreds of customers to provide consistent, effective quotes for clients and, in doing so, adhere to regulations on fair trading practices.” Learn more about Quote Conversion Tool Tweet 10. March 2016 13:45 Jordan Drury Comments (0)
Poll results: Has the latest Law Society Practice Note led to any changes at your practice? Ever increasing fraud levels and increasingly sophisticated methods of fraud are, it seems, an ever-present threat now for the property transaction and sadly this isn’t a new problem. Back in 2008 research by American Express identified ID theft as the biggest security concern for 43% of individuals in the survey - higher even than street crime. If the poll was re-run today that 43% figure would probably be higher. Conveyancers will be all too familiar with the increasing levels of fraud and the almost exponential growth in the number of warnings the SRA have issued over the last few years in relation to bogus law firms. In turn, the last few SRA Risk Reviews have had fraud as the central theme. Probably in response to the latest SRA Risk Review where the three primary risks were fraud related (bogus law firms, money laundering and cybercrime), the Law Society on 21st August 2015 published a practice note aimed at helping law firms recover if they fall victim to a client account scam. On the back of the new practice note, in September, TM Group asked conveyancers: “Has the latest Law Society Practice Note led to any changes at your practice?” The results were surprising with at least a third of conveyancers stating that they hadn’t even heard of the practice note (see chart below). Continue reading > 27. October 2015 10:48 Nick Dyoss Comments (0)
Poll Results: Which of these risk areas are you most concerned about? During July, the SRA published the latest Risk Outlook 2015/16 with an overview of their risk priorities. The identified risks fell neatly into either an internal risk: such as service standards, acting with integrity and standards of service; or external risk: notably bogus law firms, money laundering and cybercrime. In August, we asked you what you perceived to be the major risks as identified in the latest SRA report. The findings were startlingly clear as the chart below shows. Internal risks There is no obvious concern with any of the SRA’s ‘internal’ risks, with firms confident in the way they conduct themselves and act with clients, which is probably to be expected. After all it is unlikely that any of these issues would be aired publically in a survey! External risks Of the external risks, the primary concern was money laundering, followed by bogus law firms, and lastly cybercrime and security. Perhaps money laundering, or should I say the prevention of it, may well have a higher profile at the moment on the back of the SRA’s focus on this during the first half of the year. Bogus law firms 'Bogus law firms' has been identified as a high risk area for around two years now and was identified in SRA Risk Review in 2014. The number of reports to the SRA about bogus law firms continues to increase and so does the number of scam alerts, with 183 issued in 2014 which is up from 97 in 2013 and only 19 in 2012. A worrying trend. Cybercrime & information security The final issue of cybercrime and security is perhaps the glue that joins these other issues up. Firms holding client accounts are vulnerable to the risk of theft of confidential data which could lead to the theft of client money held in these accounts. The most common types of cybercrime in the legal sector are 'phishing' emails, cloned websites and the interception of solicitor-client emails. So rather than viewing these three issues separately, perhaps they can be seen as one with a secure IT system supported by strong processes being the key? Without all three being addressed there will always be a weakness to be exploited. With cybercrime and fraud on the rise and increasingly sophisticated being used it can feel like conveyancers are in the eye of an increasingly worsening storm. However there are some simple steps and a lot of excellent information readily available to help with these risks. Practical steps to take SRA http://www.sra.org.uk/risk/risk.pagehttp://www.sra.org.uk/risk/resources/risks-associated-bogus-firms.pagehttp://www.sra.org.uk/risk/resources/risk-money-laundering.page The Law Society The Law Society has published a Practice Note in August, providing advice on what to do should a firm fall victim to a scam. Searches To assist firms in complying with the legal and regulatory requirements there are some inexpensive searches available for them to include as part of their conveyancing service, which includes: - Making independent verification checks using Lawyer Checker which is only £10 and widely available; and - Online AML verification which is readily available, inexpensive, comprehensive and instantaneous and covers UK and International clients from about £4 per name and £10 for commercial checks. Tweet 6. October 2015 15:41 Nick Dyoss Comments (0)
Answer the poll: Which SRA warning area presents the greatest risk to your firm? (Closed) Each year the Solicitors' Regulation Authority (SRA) publishes its risk review for the forthcoming 12 months, outlining what it thinks presents the greatest threats to 'the people who use legal services, the operation of the rule of law, and the proper administration of justice'. This year, the SRA believe the riskiest areas to be: failure to provide a proper standard of service; misuse of client money; lack of a diverse and representative profession; lack of independence; failure to act integrity; information security & cybercrime; bogus law firms; and money laundering systems. Of these threats, which do you think present the greatest risk to you and you firm? (Poll is now closed)Tweet 11. August 2015 10:12 Jordan Drury Comments (0)
SRA Springs Into Action, by Nick Dyoss Last month saw the SRA publish their Risk Outlook for Spring 2015 which showed that little - in terms of the risks faced by firms - has changed much since their Autumn Update. The key areas of concern for the SRA remain bogus law firms, money laundering and the misuse of money or assets. Some the figures associated with these issues are staggering. In 2014 the SRA received over 700 reports of bogus firms which is the highest ever recorded. In 2013 the SRA received 548 reports about bogus law firms, up from 312 in 2012, so it is easy to see why bogus law firms are now seen as a real risk by the SRA to all sizes of law firms and should the rise in firms reported continue at the same rate in 2015 the figures will be near 1000. Sadly this is reflected nationally across the whole economy with KPMG reporting a significant increase in fraud cases. There is little evidence to suggest that this trend will decline. The SRA aim to visit 500 firms to audit their Anti-Money Laundering (AML) processes. Image copyright Images Money. The SRA are now well into their assessment of a number of firms who are subject to the auditing of their current AML processes. They are aiming to visit 500 firms and their activity has been driven by an increase in reports concerning AML compliance - a handful of cases the likes of which they have not been seen before - as well as pressure from law enforcement agencies. At a recent conference in March Steve Wilmott, Director of Intelligence and Investigation at the SRA, said that they will be looking at systems and procedures, record keeping, training and the activity of the MRLO at the firm. If they were to visit how confident would you be of passing their inspection? Another area to feature in the Spring report is the misuse of money or assets. The report revealed that things have changed little since Autumn with poor financial controls continuing to ‘provide opportunities for financial misconduct to occur.’ Within the update, the regulator states that they have seen recent cases where ‘poor systems and controls have been a factor in the misuse of money or assets’, citing that the root of the problem lies in inadequacies in training and supervision, as well as failure to control access to accounts. So what can firms do to reduce these key risks? Well there is certainly quite a lot of information and service available which I will touch on. 1. Use ‘Find a Solicitor’ on the Law Society website. 2. Check the SRA website for updates on scam alerts. 3. Make independent verification checks using Lawyer Checker which is only £10 and widely available. 4. Online AML verification is readily available, inexpensive, comprehensive and instantaneous and covers UK and International clients from about £4 per name. 5. Reliance on bank statements, passports and utility bills should be consigned to the past. 6. Use secure search websites that are username and password protected and can provide an audit trail for every case. Tweet 14. April 2015 09:28 Nick Dyoss Comments (0)
‘Trust me, I’m a lawyer’ – the risks of bogus law firms The number of bogus law firms reported to the SRA over the past few years has increased exponentially. So much so, in fact, that the SRA saw fit to reserve special mention for the problem in their recent update to the risk outlook 2014 - and yet, many law firms remain blind to it. Continue reading > 28. November 2014 10:20 Jordan Drury Comments (0)
Bogus Law Firms – the latest threat to conveyancers? When the SRA published their Risk Outlook 2014-15 in July of this year to assess the key risks to firms in carrying out their regulatory objectives there was a new entry in the Risk Outlook chart compared to 2013, namely bogus law firms. The other four including misuse of money, money laundering controls, a failure of service and diversity within the workplace remain, so where has this new threat emerged from? Continue reading > 16. October 2014 09:19 Nick Dyoss Comments (0)
SRA steps up their focus on Anti-Money Laundering Law firms need to be aware of their attractiveness to criminals who seek to launder the proceeds of crime through conveyancing transactions. Image copyright Images Money. The Solicitors’ Regulation Authority (SRA) is stepping up its efforts to ensure that law firms do not become embroiled in money laundering activity and are compliant with the various regulations and legislation associated with anti-money laundering compliance. In their Risk Outlook 2014-15, published in July, the SRA highlighted how law firms are an attractive vehicle through which to launder the proceeds of crime, such is the magnitude of funds being transferred by legal practices. Continue reading > 30. September 2014 09:59 Nick Dyoss Comments (0)
80% of property solicitors not performing bank account checks In a recent survey to discover what checks, if any, conveyancers do before sending money to the seller's solicitors, it was revealed that 80% of conveyancers are still not performing bank account checks before handing over client and lender monies. The survey was conducted at a recent conveyancing CPD seminar designed to help property solicitors mitigate risk and comply with regulatory requirements and was hosted by TM Group featuring guest speaker Jenny Owen from Lawyer Checker. Mortgage fraud is one of the most significant and costly areas of risk for conveyancers and can put your PII renewals under serious threat. In 2013, the National Fraud Authority estimated the annual financial loss attributed to mortgage fraud at £1bn and lenders and clients will almost certainly have the inclination and right to initiate litigation to claim any lost money back. Continue reading > 19. May 2014 16:45 Jordan Drury Comments (0)
Monthly Poll: Mortgage Fraud Risk In a recent survey, mortgage lenders identified 'solicitor negligence' as the greatest risk to their businesses. Mortgage fraud is a threat that is growing each year; in its 2013 Annual Fraud Indicator report, the National Fraud Authority estimated the annual loss attributed to mortgage fraud to be £1bn. Meanwhile, the SRA received 549 reports of bogus law firms in 2013, a 57 percent increase on the number from 2012. Continue reading > 26. March 2014 14:45 Jordan Drury Comments (0)