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Disagreement over future of regulation of estate services

Responses to the Legal Services Board’s (LSB’s) consultation on the future of the regulation of estate services show little agreement among interested parties.

16 August 2012

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The LSB’s consultation period ?ended in July and thirty-six ?organisations, including Solicitors ?for the Elderly (SFE), the Society of ?Trust and Estate Practitioners (STEP) ?and the Association of Chartered ?Certified Accountants (ACCA), ?responded to the board’s proposals. However, there are considerable differences of opinion between the respondents, with most also disagreeing with one of other of the LSB’s suggestions.

The LSB wants to extend the list of reserved activities to include will-writing and estate administration, as well as probate which is already reserved in England and Wales. It also suggests that existing regulation in these areas is not working well for consumers and needs to be improved, with more emphasis on supervision of businesses that provide the services, rather than the professional titles of the individuals within businesses.

While SFE agrees with the list of core regulatory features, it believes the LSB’s suggestions should go further to include restrictions on referrals and partner firms.

“An additional feature that we would like to see reflected in the core mandatory regulations would be that the practice of ‘referring’ consumers to companies and indicating that they are ‘partner firms’. This is common in probate practice at a time when the consumer is particularly vulnerable and should, in our opinion, be made illegal,” said the SFE in its submission.

The SFE has also called for better training. “We believe that ongoing training and education is a necessity to ensure that providers have a sufficient level of skill and expertise to practice. We would suggest that providers should have mandatory training in will writing, but that they should also demonstrate sufficient knowledge in respect of mental capacity, undue influence,” said the SFE.

This view was supported by the Institute of Professional Willwriters (IPW). “There [needs to be] a step change in the availability of training and education, in will writing in particular.

“We are not aware of any tailored training programmes that are available to enable the workforce to access such bespoke training. In our experience the range of training programmes currently available for will writing is poor. For example, we are aware of a module that is offered in will writing but it does not include any subject matter on the appointment of guardians. The reason given for this is that this subject is covered in a module on family law, but the family law module is not mandatory for a student who takes the will writing module to complete,” wrote the IPW in its submission.

There is also considerable disagreement over exactly who should regulate the newly reserved activities. The Association of Chartered Certified Accountants (ACCA) wrote: “We believe that there is considerable merit in allowing professionals who are already adequately regulated (such as members of the chartered accountancy bodies) to be exempt from regulation by the Board in respect of services ancillary to will writing and estate administration. This should include the preparation and submission of papers on which to found or oppose the grant of probate or letters of administration.

“We firmly believe that, wherever professionals are subject to regulation by their professional body, and that regulation conforms with the principles of better regulation, and is subject to appropriate oversight, it is not necessary (and is, in fact, counterproductive) for them to be regulated by an approved regulator subject to oversight by the Board.

“Clearly, there is an imposing argument against oversight of the regulation of accountancy services by a legal services regulator. This would neither replace nor enhance the standard of regulation in those areas. In fact, duplication of regulation gives rise to the risk of unnecessary complication, unreasonable cost, and even conflict between lead regulators. We should urge the Board not to consider overseeing the regulation of a wide range of accountancy services without first consulting the Financial Reporting Council (FRC) and the Department for Business Innovation and Skills (BIS),” said the organisation.

The LSB is expected to publish a further consulation document in the next few months. This will be followed in the winter by a final report with a recommendation that the lord chancellor amends the list of reserved activities. ?The lord chancellor then has three months to decide whether to accept ?the recommendation.

For all of the responses see

Categorised in:

Wills, Trusts & Probate