Both the SRA and FCA have controls and restrictions to stop the misuse of client money accounts and the breaches or abuse that has happened within the financial services industry. There have been a number of high profile cases recently which incurred fines or liquidation, highlighting that even financial services firms are still struggling with the correct operation of these accounts. Since 2003, Global Currency Exchange Network (GCEN) & their sister company Global Custodial Services (GCS) have been successfully helping clients with their money management requirements. Being authorised and regulated by the FCA, we speak to their Director, who touches on why law firms need to tread carefully when handling client money.
Fines and prosecutions are on the increase. In the last 12 months, over 20 solicitors and three law firms have been prosecuted. Are there similar repercussions for other FCA regulated firms that have fallen foul of the aforementioned risks you see with SRA regulated firms? Absolutely, there have been similar fines handed out by the FCA over the years due to non-compliance and this presents a heavy burden to firms who must stay abreast of the evolving regulatory position. If a legal practice is not enforcing the required policies and procedures to ensure compliance, the repercussions could be as severe as imposing custodial sentences. Regardless of the solution you choose to utilise, whether outsourcing or fulfilling in-house, it’s imperative that any legal practice understands and acknowledges the regulatory requirements in handling client money. Banks are becoming more risk adverse. What other options or solutions have you seen within the legal sector. Do you need specific permissions to operate a client money account? https://www.lawyer-monthly.com/issues/2018/11/26/