An increase in contributions to support the Solicitors Compensation Fund (SCF) will be offset by a four per cent fall in solicitors’ practising certificate (PC) fees, a report has shown.
The Solicitors Regulation Authority (SRA) said an expected rise in involvement in fraudulent investment schemes will see compensation contributions rise by £8 to £40 per solicitor, while firm contributions will increase by £230 to £778.
“The number of solicitors involved is very small, but the impact is very significant both in terms of damage done to the reputation of the profession and the losses sustained by what are often vulnerable members of the public,” the SRA said.
“People have already lost substantial amounts, potentially totalling hundreds of millions.”
The regulator said it expects funds in the compensation fund to drop as a number of cases are settled over the next 18 months.
“Not every case will result in successful claims, but it is important that sufficient funding is available,” it said.
Meanwhile, the Law Society announced that it will drop its PC fee to £278, down £12. It said it will collect £1.2 less than last year as a result of increased income from other sources – mainly £15.8 million in commercial income.
It will collect £137 million in total, with £52.6 million going to the SRA and 32.8 million to the Law Society. The rest will distribute between the Legal Ombudsman, Legal Services Board, and the Solicitors Disciplinary Tribunal.
Around £300,000 will also be set aside to pay for a new regulatory role created by the Financial Conduct Authority to focus on money laundering activity.