Cordella Bart-Stewart, Executive Director of the Black Solicitors Network (BSN), gives us her reflections on financial management, and SRA disciplinary cases involving BME practitioners.
Last week, LexisNexis hosted a compliance and financial management workshop, in association with BSN and the SRA. We were delighted to have met with around 40 practitioners from a broad range of firms, to network, and share tips and best practice.
Here is an excerpt from Cordella’s opening address, exploring the findings of the recent SRA Independent Comparative Case Review into disciplinary cases involving BME practitioners, calling for more support to eliminate disproportionality.
The genesis of this event are the findings of the Independent Comparative Case Review commissioned by the SRA of how the SRA has dealt with disciplinary cases involving BME practitioners as compared to others with a view to identifying potential improvements to their practices, policies and procedures to maximise fairness and consistency. The review reported earlier this year.
The review found evidence of disproportionality at the point at which a case is raised or a complaint is registered against a solicitor or a firm; in the process of investigating that complaint; and at the point at which an outcome is determined and a sanction imposed.
Between 2009-2012 as an average, BME solicitors made up 13% of the entire solicitor population, but 25% of the ‘new conduct investigations’. They comprised a higher percentage of those against whom action was taken and were also subjected to more severe sanctions than their White counterparts.
But Professor Gus John, who led the review, controversially for some, said that these results should not immediately be interpreted as evidence of discrimination or racism on an institutional level. He pointed to a number of what he called “complex socio-economic and political factors” to be considered as part of a full discussion of disproportionality.
After talking about social capital or our lack thereof he specifically noted that at the time of investigation white solicitors had been on the roll for more than twice as long as their BME counterparts and BME solicitors investigated had established sole practices with only 6 years post qualification experience (PQE), compared to 19 years PQE for White solicitors.
He concluded that less experienced sole practitioners are more likely to fall foul of SRA regulation as they lack the resources to both ensure best practice is always followed and to insulate themselves against investigation.
The data collected indicates that the most frequent offence triggering an investigation by either the SRA or SDT related to financial irregularities falling under either a breach of the Solicitors’ Account Rules and Practising Regulations (SAR), or Fraud, Dishonesty and Money Laundering (FML).
He gave explanations for why BME firms may be more vulnerable and said:
Frustrations and limitations in career opportunities may result in a BME individual working for smaller firms or deciding to advance their prospects by starting sole practices, relatively soon after qualifying. It is perhaps also the case that some BME solicitors, recognising the fundamental principle of providing access to legal representation, may choose to establish practices aimed at serving BME communities.
Smaller, less established firms or inexperienced sole practitioners, particularly if affected by billing issues relating to discipline specialisation, lack the financial resources of larger firms that could act as a cushion against temporary cash flow problems, for example. They are, therefore, less able to manage their finances to ensure best practice is consistently adhered to. Given the aforementioned scrutiny of financial issues by the SRA, individuals at these firms are more likely to find themselves under investigation resulting in a sanction. If BME solicitors are disproportionately represented in the composition of these more vulnerable firms, then BME solicitors will be disproportionately investigated for financial irregularity. As these firms lack resources in the first place, they will be less able to structure solid and robust defences and may, therefore, be more susceptible to more severe sanctions, resulting in evidence of procedural disproportionality.
He recommended that the Law Society as the profession’s representative body:
a) explore what positive action provisions can be made for BME solicitors and sole practitioners to enable them to deliver the best possible services to their communities within the challenging environments in which many of them operate, and
b) consider the extent of practical support that can be provided, including the provision of more extensive toolkits, or guidance on the challenges of setting up and running small firms, including guidance on the Regulations and requirements concerning setting up sole practices or small firms and on the capitalisation rules, to ensure that solicitors seeking to set up firms have sufficient knowledge and experience of the regulatory rules and that they are adequately capitalised to be able to cope with the financial pressures that small firms face.
Having been a sole practitioner from the days when we only had a slim volume of the Professional Conduct Guide incorporating the Accounts Rules to OFR, COLPS, COFA’s which I confess to finding bewildering, I think there is a lot of force in what Prof John says and that BME Solicitors cannot afford to wait on the Law Society.
So what I have tried to do with this event is bring together the regulators, the regulated and LexisNexis who have drawn up a set of compliance tools to help small firms and hopefully we can work together to eliminate this disproportionality.
We are here to help you and hope you leave feeling more confident about the whole regulatory process and the survival of your firms.
Want to find out more?
View the event materials, including a host of free resources on practice compliance and financial management.
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