Reporting for duty – the obligation to self-report

Navigating the SRA’s reporting obligations can prove a headache for firms. The decision to report potential misconduct is becoming more difficult, as the SRA is focusing on a broader range of behaviours than ever, including ethical (or unethical) conduct.

What are the SRA reporting obligations?

There are two scenarios which are relevant here: (1) events that automatically trigger an obligation to self-report, and (2) events that require individuals/firms to assess whether self-reporting is necessary.

Circumstances surrounding an automatic obligation to self-report include where a solicitor is charged, convicted or cautioned with a criminal offence, becomes insolvent or where self-reporting requirements might be set out in a firm’s professional indemnity insurance policy.

What is more difficult, however, is the situation where there is no automatic requirement to report. This requires individuals/firms to assess whether self-reporting is necessary. The rules state that there are three circumstances where this obligation is triggered, namely where there are any facts or matters that:

1. You reasonably believe are capable of amounting to a serious breach of regulatory arrangements;
2. You reasonably believe should be brought to the SRA’s attention in order that they may (i) investigate whether a serious breach of their regulatory arrangements has occurred or (ii) exercise their relevant regulatory powers; and
3. Raise questions as to the character and suitability of an individual.

What is a serious breach?

The most difficult question is assessing whether there has potentially been a “serious breach”.

That term is not defined but the SRA provides some common factors which affect its view of seriousness. These include: (i) intent and motivation, (ii) harm and impact, (iii) vulnerability of the client, and (iv) experience and seniority of the individual concerned, as well as their regulatory history and whether there are patterns of repeated misconduct or regulatory breaches.

That said, some breaches are considered to be more serious than others, and will likely require a self-report, including: (i) an abuse of trust, (ii) taking unfair advantage of clients or others, (iii) the misuse of client money, (iv) sexual and violent misconduct, (v) dishonesty, (vi) discrimination and (vii) harassment and criminal behaviour.

To assist, the SRA provides certain examples as to when a report should be made:

Example 1 – A junior lawyer experienced unwanted attention from a senior partner during a training event five years ago. She tells her colleague, who thinks she should report it, but she wants to forget it. The colleague is worried about the impact on both their careers if he reports it. In these circumstances, the SRA would conclude that the allegations involve serious misconduct and possible criminal conduct. A report should be made.

Example 2 – Concerns are raised by an advocate about another solicitor’s conduct in representing the opposing side, including being late to court, not reading key documents and acting without instructions. The advocate complains to his head of section, who is aware of a previous report regarding the solicitor acting without instructions. In this scenario, the SRA take the view that a report should be made as there is a clear pattern and serious concerns about acting without instructions.

Timing

If something is considered to be sufficiently serious, the obligation requires a “prompt” report to the SRA. Again, this is fact-dependent and depends on the seriousness of the potential breach, although the SRA does allow firms some discretion for lesser breaches. For example, firms are given time to investigate and consider whether the matter should be reported, save for situations where the need to report with urgency is clearly made out - including situations where clients or client money are at risk.

How do I make a report?

An obligation on a regulated individual to notify the SRA will be satisfied if they provide the relevant information to their firm’s COLP or COFA, as appropriate, on the understanding that that person will notify in turn. There is no particular format in which a report needs to be made, although the SRA encourages use of the online reporting form, which can be accessed here. Our usual advice is to keep reports short and factual. They do not, for example, need to include allegations against the individual(s) concerned, nor is that a strategy we would recommend. Rather, reports should set out the short factual background, what has led to the concerns and a short summary of any immediate remedial steps taken.

What if I get this wrong?

The risk of not reporting is serious, as this failure alone could constitute an additional breach of the SRA Standards and Regulations, which could attract a sanction.  It should be borne in mind that reports can be made by anyone, including other solicitors, clients and/or members of the public, and so a decision by an individual lawyer or firm not to report will come under scrutiny if the matter comes to the SRA’s attention by way of another person’s report.

Cooperation and engagement are key when it comes to dealing with the SRA effectively.

Prompt self-reporting can provide mitigation when considering sanctions, save for the most serious offences.

We regularly assist individuals and firms in navigating these thorny issues. If in doubt, it is usually better to make a report, but our strong recommendation is to document the reasons for any decision not to report and to keep reports made short and factual.