Enforcement

Under the Legal Services Act, “approved regulators” such as The Law Society have responsibility for the day-to-day regulation of lawyers. Following a consultation exercise, the Legal Services Board has finalised a policy statement describing how it intends use its enforcement powers, if necessary, to help ensure that the approved regulators comply with their responsibilities effectively.

The powers that the Legal Services Board may use range in severity. They include: setting performance targets; issuing directions that require approved regulators to act in a certain way; public censure; financial penalties; intervening in an approved regulator in order to carry out regulatory functions itself; and cancelling an approved regulator’s designation to regulate lawyers.

The most controversial issue was the maximum size of the financial penalty. The Legal Services Consumer Panel called for the Legal Services Board to set a “significant” maximum level of fine. We were pleased that the Legal Services Board has set the maximum financial penalty at 5% of all income which the approved regulators derive from their regulatory functions. In the case of The Law Society, the maximum fine payable would be in the region of £5 million.

Key documents