SRA ceases regulation of insolvency practitioners
Practice area judged not to be integral to the services provided by solicitors
The Solicitors Regulation Authority (SRA) will no longer regulate solicitors who act as insolvency practitioners following a decision by its Board.
At a Board meeting on 11 March, it was decided that insolvency work was not central to the work of a solicitor, and consumers would be better protected if solicitors were regulated by those organisations identified by the Insolvency Service.
There are currently 129 solicitors operating as insolvency practitioners in England and Wales.
A consultation was held on SRA regulation of solicitor insolvency practitioners between November 2014 and January 2015, and the SRA met with a group of practitioners during the process.
A total of 17 written responses to the consultation were received, the majority of which opposed the SRA's proposal.
Crispin Passmore, SRA executive director, said: 'Insolvency practice is not integral to the services provided by solicitors, so there is no case for us to regulate in this area. It's also in the public's interests for solicitors providing insolvency services to be regulated by the recognised professional bodies with specialist expertise in insolvency practice.'
The SRA will now apply to the Legal Services Board (LSB) to revoke the Insolvency Practice Rules 2012 and to amend the necessary regulatory arrangements.
If the super-regulator agrees with the proposal, the Insolvency Service will lay an order before the Secretary of State for the Law Society's Recognised Professional Body status to be removed.
The SRA is contacting solicitor insolvency practitioners to inform them of the decision. Any regulatory change should take effect from 1 November 2015.