Regulatory Role of SRA (U1)

Question 1

Who governs the SRA?

Answer 1

Board of 9 members (4 solicitors + 5 lay members)

Question 2

What is the risk based approach the SRA adopts?

Answer 2

Assesses risk to achieving its regulatory objectives

• Risk = impact of a certain event occurring (potential harm that could be caused) + probability of the event occurring

Question 3

What should be the firm’s approach to risk management?

Answer 3

Para 2.5 - firms must engage in own risk managements; identify, monitor and manage all material risks

Question 4

Which businesses are eligible for SRA authorisation?

Answer 4

• Recognised sole practice
• Recognised body
• Licenced bodies

Question 5

Who can the SRA authorise?

Answer 5

Firms and individuals

Question 6

What is a recognised sole practice?

Answer 6

Solicitor that practices alone; responsible for firm entirely

Question 7

What is a recognised body?

Answer 7

Where:
* At least 75% of body’s managers are legally qualified
* They hold at least 75% of the shares or voting right
* Managers who are not legally qualified are approved by SRA
* At least one manager must be solicitor

Can take form of:
* Partnerships
* LLP
* Companies

Question 8

What is a licenced body?

Answer 8

Alternative business structure and is wholly or partially owned by non lawyers.

Question 9

How can a licenced body be eligible for authorisation?

Answer 9

• Must be at least one manager authorised by the SRA or another approved regulator AND
• Has to be a ‘licensable body’

Question 10

What is the effect of authorisation by the SRA for a recognised body?

Answer 10

Recognised body can carry on all reserved legal activities (except notarial activities) AND can carry out immigration work

Question 11

What is the effect of authorisation by the SRA for a licenced body?

Answer 11

Can carry out same range of activities as recognised body in accordance with the licence granted by SRA

Question 12

What must a recognised body have at all times?

Answer 12

• Compliance Officer for Legal Practice (COLP)
• Compliance Officer for Finance and Administration (COFA)
• Both approved by SRA

Question 13

What must a licenced body have at all times?

Answer 13

• Head of Finance and Administration (HOFA)
• Head of Legal Practice (HOLP)

Question 14

How can an individual be a practicing solicitor?

Answer 14

• Admitted to the roll
• Practicing certificate

Question 15

What happens if an unqualified person practices w/o a certificate?

Answer 15

Criminal offence

Question 16

How does a person get admitted as a solicitor?

Answer 16

Applicants must meet qualification and training standards, and the SRA must be satisfied with their character and suitability.

Question 17

What is treated as most serious in the character assessment and likely to result in an application refusal (criminal)?

Answer 17

Applicant has been convicted by a court of a criminal offence resulting in a custodial or suspended sentence involving:
* Dishonesty
* Perjury
* Fraud and/ or bribery
* of a violent or sexual nature
* Associated with obstructing the course of justice
* Associated with terrorism
* Discrimination towards others.

Caution has been accepted from the police for:
* Offence involving dishonesty
* Violence
* Discrimination
* Sexual offence
* Applicant has been included on the Violent and Sex Offender register.

Question 18

What is treated as most serious in the character assessment (criminal)?

Answer 18

May result in refusal (e.g., lesser convictions or cautions that are not in the most serious category).

Question 19

What are the individual’s disclosure obligations?

Answer 19

Applicants must disclose all relevant conduct, including from overseas

Question 20

Who is eligible for a practicing certificate?

Answer 20

• Be on the roll
• Have adequate English/Welsh language skills
• Not be suspended from practice as a solicitor.

Question 21

How often must practicing certificates be renewed?

Answer 21

Annually by October 31st, with a fee payable.

Question 22

Who may be exempt from authorisation?

Answer 22

• Freelance solicitors
• in house solicitors
• non- commercial organisations

Question 23

What is the effect of professional indemnity insurance?

Answer 23

insurer indemnifies the insured in respect to the loss/damage

Does not absolve the solicitor from liability

Question 24

What is the minimum coverage of indemnity insurance?

Answer 24

• For recognised and licenced bodies = £3 million
• Other cases = at least £2 million
• Firm must not exclude liability below this minimum level

Question 25

Which firms does the requirement for adequate and appropriate insurance apply to?

Answer 25

• SRA authorised firms
• freelance solicitors
• non-commercial organisations if providing legal services