Hot topic: how clean is your firm?

Details emerged this week of a High Court decision in which the SRA secured a s43 order against a cleaner involved in the misappropriation of client…

Details emerged this week of a 2012 High Court decision in which the SRA secured a s43 order against a cleaner involved in the misappropriation of client monies. The effect is that the cleaner will not be allowed to work in a law firm without the regulator's permission.

We discussed the decision with Martina Hogg, Lead Compliance Consulant within Compli, as part of our '60 seconds with...' feature for this week's newslette:

"Martina, the SRA recently obtained a s43 order against a cleaner. Does this mean we will all have to start cleaning up after ourselves or work in dirty offices from now on?

The facts of this case are very specific. The cleaner appears to have received monies misappropriated by another member of staff. It has to be right that anyone involved in such activities is not fit and proper to work in the offices of a law firm.

On a serious note, does this mean that solicitors have to vet everyone that comes through the door? How can we make sure the postman isn’t subject to a s43 order?

I do not think there is any need to be alarmist. Vetting staff is only one part of the answer and deciding who to vet is something each firm needs to consider. Firms should adopt a risk-based approach and consider other issues too. For example, do you have a clear-desk policy? Is it properly enforced and monitored? If your firm is acting for a professional footballer in a high-profile case, can any staff, cleaners or other parties access the relevant electronic or paper files?

It is likely that staff will be aware that they cannot sell client-specific information to the media; however, do they also appreciate that they cannot gossip to their friends about it?

So, does this mean that we need to be suspicious of everyone? Is it time to dig a moat around the office and bring up the draw-bridge?

I think that might be a slight overreaction. Simply understanding your firm and how it operates will empower you to identify risks and implement the appropriate systems to monitor and manage the same.

In another recent noteworthy case, the SRA obtained an injunction against Dixit Shah – a struck-off solicitor who had served a custodial sentence for fraud offences – to prevent him from either holding himself out as a solicitor or being involved in a law firm in any capacity. Whilst this is an extreme example of the risk some individuals may pose to a firm, it remains an issue and firms must be vigilant. At a recent roundtable meeting hosted by The Law Society, Steve Wilmott, the SRA’s director of intelligence and investigations, stated that bogus firms “create immense damage” to the profession’s credibility.

Ask yourself: are you comfortable that you have the requisite policies and procedures in place and that you know what is going on in your firm? If the answer is no, speak to us about our benchmarking questionnaire and health-check!"

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