In September 2024, a growing number of legal professionals have voiced strong opposition to the Solicitors Regulation Authority’s (SRA) proposed plans to drastically increase its fining powers. Several prominent legal bodies, including the City of London Law Society, have already raised alarms, branding the proposals as unnecessary, confusing, and potentially unlawful. The Birmingham Law Society’s professional regulation committee is the latest body to challenge the proposals, describing them as ‘unfair’ and ‘lacking sufficient evidence’ as described in an article in the Law Gazette.
SRA to Impose Higher Fines up to £500,000
The SRA wish to impose significantly higher fines, creating two additional fining bands and enabling penalties of up to £500,000. Such decisions are to be approved solely by a senior employee, without external oversight or scrutiny.
SRA Fines based upon Gross Income and Turnover
Another aspect under scrutiny in the SRA’s proposal is its plan to calculate fines based on the gross turnover of firms and the gross income of individuals. The Birmingham Law Society has criticised this, stating that “a fine should reflect the seriousness of a breach, not the wealth of the firm or individual involved”. Fines taken as a percentage of the firm’s overall turnover create unfair pressure on practitioners and puts their livelihoods at risk, particularly for smaller firms or sole practitioners.
Are SRA Fines Potentially Unlawful?
Several prominent legal bodies, including the City of London Law Society, have already raised alarms, branding the proposals as unnecessary, confusing, and potentially unlawful. The Birmingham Law Society echoed these concerns, highlighting the absence of an independent element in the decision-making process. Their statement accused the SRA of citing the risk of unchecked power with little accountability.