Following consultations, the Solicitors Regulation Authority (SRA) has updated its approach to the way it issues financial penalties for proven misconduct. Changes introduced by the SRA include:

  1. Cases where a fine is not an appropriate penalty: The SRA has amended its enforcement strategy to make it clear that for any case involving sexual misconduct, discrimination or any form of harassment, a financial penalty will only be considered in exceptional circumstances. Instead, suspension or strike off is likely to be appropriate.
  2. Linking fines to income: The SRA has amended its fining framework for firms and individuals so that it takes into account, in all cases, the turnover of firms and income of individuals when setting the levels of fines. For firms, the SRA has increased the maximum amount it will usually fine firms to 5% of annual domestic turnover. For individuals, the SRA will use salary information or default salaries, based on seniority and place of work, as the basis for setting fines for those who do not provide the required evidence of their income. Information on how the SRA determines the appropriate level of fine can be found in its updated financial penalties guidance.
  3. Fixed penalties: The SRA has introduced a schedule of fixed penalties for firms of up to £1,500, which apply to a small number of lower-level breaches of SRA rules to enable lesser issues to be dealt with in a timely way. Examples of misconduct which may result in a fixed penalty include failure to comply with a regulatory request for information or failure to publish the required costs or complaints information in accordance with the SRA Transparency Rules.

The new regime came into force on 1 June 2023 and the SRA states that the changes it has made will help it to resolve cases “as quickly and effectively” as possible, providing, amongst other things, a credible deterrent and upholding public confidence in the legal professional. It will however continue to refer serious cases of misconduct to the Solicitors Disciplinary Tribunal (SDT), which can suspend and strike off solicitors and impose fines (which are not subject to any upper limit). In 2021/22 the SRA referred 76 cases of serious misconduct to the SDT. The SRA states that it will be publishing information on the fines it issues in its annual Upholding Professional Standards report, including on how it has used these new fining powers.