SRA to continue consumer credit regulation role, following Law Society representation
The Law Society is delighted that the Solicitors Regulation Authority (SRA) has chosen to continue to be a designated professional body for the regulation of consumer credit activity.
The decision reflects the Law Society's representation, during the consultation period, of its members’ experiences and views. This ends a period of uncertainty and anxiety within the profession and is excellent news for both solicitors and users of legal services.
Law Society president Jonathan Smithers commented: “We are delighted that the SRA has listened to the profession and accepted that solicitors undertake consumer credit work as part of their everyday business activities and therefore it should not be regulated separately.
"This decision ends a period of uncertainly and ensures that solicitors can continue serving their clients without having to incur significant costs registering and being regulated by the Financial Conduct Authority as well as by the SRA.”
The Law Society recognises the constructive engagement the SRA has undertaken on a notoriously complex and technical area of regulatory law with both the Financial Conduct Authority (FCA) and the profession. As a result, many firms will avoid the need for dual regulation with the significant additional costs that this would inevitably entail.
Following the publication of its original consultation on 13 October 2014, there were fears that a large number of firms could be adversely affected by having to also register with the Financial Conduct Authority. There were concerns that as well as creating significant additional costs within the profession, the proposed changes could lead to many firms simply deciding not to undertake credit-related work in order to avoid the need for dual regulation. This in turn could have resulted in a reduction in the range of advice and services available to consumers. However, the SRA has now decided that it is right - in principle and in the interests of consumers - that the regulation of all aspects of solicitors' business should, as far as possible, sit with a single regulator.
