Deal with compensation claims
The Solicitors Regulation Authority (SRA) is having to hire more staff in a bid to handle the flood of claims stemming from the collapse of law firm Axiom Ince.
The regulator confirmed it has recruited an additional seven members of staff at a cost of £310,000 as a criminal investigation into the collapse of the firm continues.
The additional costs will covered by the SRA’s compensation fund that solicitors contribute to through a levy added to the practising certificate fee.
In November, the SRA said £33 million worth of claims had already been submitted by former Axiom Ince clients. It also confirmed it wouldn’t require solicitors to cough-up additional cash to help bolster the compensation fund before the annual level payment is due in late 2024.
“This additional headcount will ensure claims handling times are maintained and that statutory trust balances and promptly reconciled to allow cash to be returned to the compensation fund as required,” the regulator said. “This will ensure that claimants can be paid while at the same time ensuring cashflows to the fund are maximised, reducing the risk of a potential call for further contributions during the financial year.”
Legal Cheek previously reported that the Axiom Ince was shut down in October 2023 by the regulator, not long after it emerged that over £60 million had gone missing from the firm’s client account. It has been widely reported that the client money had been used to acquire law firms Ince and Plexus as well as a number of properties.
Last month, the Legal Service Board confirmed it had instructed Northern Irish law firm Carson McDowell to carry out an independent review into the regulatory events leading up to the SRA’s intervention into Axiom Ince.
Speaking at the time, the LSB said: This was a significant case with considerable consumer detriment. In the Board’s view, it will be important for public and professional confidence that any learning can be identified with independence, and that any conclusions that may be drawn are based on an objective assessment of the facts.”