Preparing For a Practice Standards Unit Visit

If notification of a visit from the SRA Practice Standards Unit arrived on your desk today, would your firm be ready - or would panic ensue? With the PSU now visiting more than 1000 firms a year and the significant sanctions that can be meted out for breaches, being caught unprepared when such a notice is received is just not an option. Managing Partner's report - Preparing for a PSU Visit - is a step-by-step guide to preparing for and surviving an SRA Practice Standards Unit visit. From receipt of the notification letter to the closing correspondence that marks the end of the process, this practical guide will show you: * How to prepare for the visit including gathering and reviewing the information requested in the Unit's schedule of information; * What to expect during a visit and what the key stages are; * How the PSU adviser will select case files for review; * The type of questions that may be asked; * What information the follow up report is likely to contain; * What you should do if you disagree; and, * How to respond to ensure that the case is swiftly and satisfactorily concluded. Preparing for a PSU Visit is the only in-depth guide on this crucial subject, providing you with key insight into: - What information the SRA might have about your firm; - The possible reasons for a visit and key beaches to be aware of; - Which units aside from the PSU that might be involved; and, - What their approaches might be. The report examines the type of breaches that may result in referral to other departments within the Authority - and what might happen if your firm is referred for regulatory action. It reveals what this might mean for your firm, how to handle it and most importantly how to avoid it in the first place. The impact that the recent changes to the rules and to the Authority's approach to regulation will have on your firm are also examined in detail - ensuring you are up to date and prepared when the notification letter lands on your desk. In addition, a summary of priorities and key actions that every firm should take now are included to help you ensure that your firm is well prepared for any future visit.

Table of Contents:
Chapter 1: Introduction 1.1 Practice Standards Unit visits 1.2 Visits from other units within the Solicitors Regulation Authority 1.3 The regulatory environment in context 1.3.1 Forensic Investigations Unit, over time 1.3.2 Regulatory action, over time 1.3.3 The PSU's view of risk, over time 1.3.4 The PSU's referral rates, over time 1.3.5 Adviser's discretion 1.3.6 Future changes 1.4 What this guide covers Chapter 2: The selection process 2.1 Sources of information available to the SRA 2.1.1 Public sources 2.1.2 Case history information 2.1.3 Complaints histories 2.1.4 Intelligence 2.1.5 Solicitors' requirement to report 2.1.6 Accountants' whistle-blowing provisions 2.1.7 Annual accounts reports 2.1.8 Practising certificate/recognition renewal application forms 2.2 The SRA's risk assessment process 2.3 Which unit might visit? 2.4 Different approaches Chapter 3: Notification and preparation 3.1 Notice 3.2 The notification letter 3.3 The schedule 3.3.1 Information on the practice 3.3.2 Risk management procedures 3.3.3 Standard documents 3.3.4 Case information 3.3.5 Complaints and claims information 3.3.6 Accounts information 3.3.7 Referral arrangements 3.4 Information not on the list 3.5 What if you do not have it or it is less than perfect? 3.6 The questionnaires 3.6.1 Investment business questionnaire 3.6.2 Equality and diversity questionnaire 3.7 What the PSU adviser will do to prepare for the visit Chapter 4: The visit 4.1 Introduction 4.2 Multiple offices 4.3 Structure of the visit 4.4 The initial meeting 4.4.1 Background 4.4.2 Work areas 4.4.3 Information and documents 4.4.4 Questionnaires 4.4.5 Equality and diversity 4.4.6 Investment business and general insurance 4.4.7 Money laundering 4.4.8 Rule 5 procedures 4.4.9 Complaints handling procedures 4.4.10 Solicitors' Accounts Rules 4.4.11 Referral arrangements 4.4.12 Other information 4.5 Case selection 4.5.1 Random or targeted? 4.5.2 Initial selection criteria 4.5.3 Selection from your case list 4.5.4 Breaches of the Solicitors' Accounts Rules 4.6 Review of documentation 4.6.1 Office manual/policy documentation 4.6.2 Standard client care documentation 4.6.3 Referral arrangements 4.6.4 Positive assurances from the PSU adviser? 4.6.5 Request for further documentation 4.7 Review of case files 4.7.1 The PSU adviser's checklist 4.7.2 Other issues identified 4.7.3 A review of client ledgers 4.7.4 Rule 5 considerations 4.8 Review of complaints handling procedures 4.8.1 The PSU adviser's role 4.8.2 A complaints handling policy for clients 4.8.3 Internal guidance for staff 4.8.4 Consistency of documents 4.8.5 Complaints register 4.8.6 Compliance with your own procedures 4.8.7 Trends analysis 4.9 Accounts review and meeting with cashier/accounts manager 4.9.1 Initial enquiries 4.9.2 Client account reconciliations 4.9.3 Office account checks 4.9.4 Issues from the case list and client ledgers 4.9.5 Old client balances 4.10 Final meeting to discuss findings 4.10.1 Purpose of the final meeting 4.10.2 What if you disagree with the PSU adviser Chapter 5: Visit report and follow-up 5.1 The visit report 5.1.1 Summary of visit 5.1.2 Standard client care documents 5.1.3 Publicity 5.1.4 Client care in practice 5.1.5 Complaints handling 5.1.6 Solicitors' Accounts Rules 5.1.7 Financial Services (Conduct of Business) Rules 2001 5.1.8 Records held by the SRA 5.1.9 Referrals of business 5.1.10 Equality and diversity 5.1.11 Rule 5 on business management 5.1.12 Conclusion 5.1.13 Summary of actions 5.2 Summary of actions and the firm's response 5.2.1 Mandatory rules and non-mandatory guidance notes 5.2.2 Types of required actions 5.2.3 Assurances 5.2.4 Specific action 5.2.5 How should you respond to the report? 5.2.6 A key point: Start preparing now 5.3 Follow-up action 5.3.1 Satisfactory response 5.3.2 Reviews 5.3.3 Re-visits and referrals Chapter 6: Referrals 6.1 Types of referral 6.2 Identifying risk areas 6.3 Issues to avoid 6.3.1 Solicitors' Accounts Rules breaches 6.3.2 Money laundering and mortgage fraud 6.3.3 Secret profits 6.3.4 Referral rule breaches 6.3.5 Fee sharing and separate business rules 6.3.6 Misleading clients 6.3.7 Commission 6.3.8 Rule 5 breaches 6.3.9 Failure to satisfy a previous report 6.4 The process and possible sanctions 6.4.1 SRA's enquiry with warnings letter 6.4.2 Firm's or individual solicitor's formal response 6.4.3 Further correspondence 6.4.4 Case worker's decision 6.4.5 Adjudication 6.4.6 Adjudicator's decision 6.4.7 Appeal 6.4.8 Regulatory settlement agreements 6.4.9 Solicitors Disciplinary Tribunal Chapter 7: Recent changes and the future 7.1 New powers and SRA proposals 7.1.1 The new recognition regime and the power to impose conditions 7.1.2 Enhanced investigatory powers 7.1.3 New disciplinary powers 7.1.4 Charging for on-site inspections leading to a regulatory finding 7.2 The PSU's position 7.2.1 Conditions on recognition 7.2.2 Investigation meetings 7.2.3 New disciplinary powers 7.2.4 Charging for on-site inspections 7.3 Principles-based regulation. Chapter 8: Summary to the guide - Your priorities 8.1 Introduction 8.2 What you can do to prevent being selected for a visit 8.3 Doing well during a PSU visit 8.4 Avoiding risk areas 8.5 Compliant business development 8.6 An emphasis on Rule 5 of the Code of Conduct 8.7 Do it now, don't leave it Index

About the Author :
VANESSA SHENTON is founder of The Compliance Partner, a consultancy that provides compliance and regulatory management advice and training to firms of solicitors, including assistance with SRA visits and enquiries. Vanessa has helped many firms to set up compliant systems and draft policy documentation needed in today's regulatory environment and has conducted mock PSU visits for firms across England and Wales. Vanessa is a member of the Executive Committees of the Solicitors' Assistance Scheme and the Law Management Section of the Law Society. In May 2009 she was appointed to the Rules and Ethics Sub Committee of the Law Society's Regulatory Affairs Board. Through these committee memberships, Vanessa is able to keep up to date on all aspects of law firm regulation and any imminent changes which affect solicitors. A non-practising solicitor, Vanessa is a former PSU adviser so has firsthand experience of PSU visits and the way the SRA operates.