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1,000 law firms lack COLPs and COFAs after 1 Jan deadline

Regulator says firms will not face automatic loss of authorisation 

2 January 2013

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By Manju Manglani, Editor (@ManjuManglani)

Around 1,000 law firms do not yet have approved compliance officers, the Solicitors Regulation Authority of England and Wales has revealed.

This figure includes 194 firms that have “failed to complete the nomination process” for the positions of compliance officer for legal practice (COLP) and compliance officer for finance and administration (COFA).

The regulator had a deadline of 31 December 2012 to notify law firms of the outcome of their applications so that their nominated COLPs and COFAs could take up their duties on 1 January 2013, as required.

Explaining the delays in the approval process, the SRA’s director of risk, Andrew Garbutt, said: “We had a large team of staff dedicated to making sure that nominations were processed as rapidly as possible.

“There are some firms which came very late to the process, or who delayed providing us with further information when required to do so, consequently these have not yet received notification of our decision concerning the nomination.

“In cases where we now have all the information we need, I anticipate we will be able to make a decision shortly. We are making every effort to ensure firms and individuals know the status of their nominations.”

Eighty-nine per cent of the nearly 10,000 firms in England and Wales received approval for their nominated COLPs and COFAs by the end of last year. The SRA has previously estimated that several hundred firms would be without compliance officers in the new year.

Any firm that did not have compliance officers in place and approved by the SRA by 1 January would be technically in breach of regulations, with sanctions ranging from reprimands and fines through to the revocation of the firm’s licence or recognition.

However, the SRA has said that firms and individuals that it did not approve by the deadline would not be subject to an automatic loss of authorisation. The revocation of authorisation on the grounds of non-compliance with Rule 8.5 of the SRA Authorisation Rules 2011 (i.e. failure to have compliance officers in place) requires a positive process, initiated by the SRA, under Rule 22.

COLPs and COFAs will play a focal role in ensuring that both law firms and alternative business structures in England and Wales have appropriate systems and controls in place to enable them to manage risks to their delivery of competent and ethical legal services.

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Risk & Compliance