Since the introduction of the revised code of conduct and in particular the requirement for law firms to have an appointed COLP and COFA never has the message been clearer that the SRA are expecting firms to take compliance issues seriously. But the question remains, are firms really benefiting and truly reaping the rewards that well managed compliance can offer?

Having previously worked as a Lexcel assessor I was often surprised how abundantly clear it was as to which firms were genuinely embracing compliance and those who were merely “ticking the boxes”. One of the easiest and most effective methods of compliance control for both COLP and COFA are regular file reviews. This also, often forms part of the requirements for many of the quality standards including both Lexcel and the CQS standard.

So, how can the effective management of compliance benefit firms?

By far the biggest cause of complaints continues to be a lack of response from the fee earner and failure to keep the client updated. Amongst other matters, regular file reviews can help to highlight whether the fee earner answers letters and phone calls promptly or reviews the file regularly providing regular updates to the client. This will help the firm to pinpoint potential areas for complaint before the issues arise. In an increasing competitive market the potential not to lose clients from needless complaints can only be viewed as positive.

Regular reviews can also help to focus attention on supervision and draw attention to trends occurring for individual fee earners.

Regular COFA reviews can highlight discrepancies and breaches in the accounts enabling them to be rectified early. Reviews can also be used to ensure that any funds due to the client are returned promptly in accordance with the compliance requirements.

Another important issue for law firms is the rising cost of indemnity insurance. Regular file reviews coupled with reported analysis of the results are an excellent way of providing your indemnity insurers with evidence that this particular area of your risk is actively managed.

Once the initial processes and procedures are put in place, regular reviewing of files should not be too time consuming and will serve as a very effective way to help firms manage particular areas of risk.

Julie Gough

Associate – Legal Eye Ltd

6 May 2014