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Fraud: Solicitors

Ministry of Justice written question – answered on 18th May 2020.

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Photo of Craig Whittaker Craig Whittaker Assistant Whip

To ask the Secretary of State for Justice, what routes for compensation victims have when solicitors involved in fraud are struck off or jailed.

Photo of Craig Whittaker Craig Whittaker Assistant Whip

To ask the Secretary of State for Justice, what recent assessment he has made of the adequacy of the Solicitors Regulation Authority powers to compensate victims of land banking scams involving solicitors.

Photo of Craig Whittaker Craig Whittaker Assistant Whip

To ask the Secretary of State for Justice, whether the Solicitors Regulation Authority plans to change the discretionary status of compensations payments for victims of fraud involving a solicitor who has been struck-off.

Photo of Craig Whittaker Craig Whittaker Assistant Whip

To ask the Secretary of State for Justice, what plans his Department has to review the (a) Legal Services Act 2007 and (b) Legal Services Board's oversight of the (i) Solicitors Regulation Authority and (ii) other regulatory bodies.

Photo of Alex Chalk Alex Chalk Assistant Whip, The Parliamentary Under-Secretary of State for Justice

Under the framework established by the Legal Services Act 2007, the legal profession in England and Wales, and the bodies that regulate it, are independent from government. It is the responsibility of the Legal Services Board (LSB), as oversight regulator, to ensure that the approved regulators are complying with the regulatory objectives set out in the 2007 Act.

The Solicitors Regulation Authority (SRA) regulates the conduct of solicitors and those who breach the conduct rules can be struck off or prosecuted before the Solicitors Disciplinary Tribunal (SDT).

The SRA has a discretionary compensation fund which is mainly for individuals where a solicitor’s firm owes them money. The SRA does not routinely compensate consumers and it is not the role of the SRA to pursue funds lost by clients from specific financial schemes.

In response to the question on the discretionary compensation payments made by the SRA I refer the honourable Member to the answer I gave on 29 April 2020 to question PQ38895.

The latest reports on regulatory performance by the LSB are available online here https://www.legalservicesboard.org.uk/our-work/regulatory-performance#regulatory-performance-reports.

There are no plans to review the Legal Services Act 2007. Arm’s Length Bodies of the Ministry of Justice are subject to a regular cycle of reviews as part of the Cabinet Office Tailored Review programme. A Tailored Review of the LSB was published in July 2017 which found that the LSB is generally effective both in promoting the regulatory objectives set out in the Legal Services Act and in delivering its functions.

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