SRA warns profession over conduct in personal injury claims
More must be done to combat fraud, says regulator's chief executive
The Solicitors Regulation Authority (SRA) has reminded solicitors of their professional obligations as a fear of fraud in personal injury cases increases.
The warning notice has been issued following the publication of a report by the government's Insurance Fraud Task Force (IFT) in January, calling for more to be done to ensure solicitors were not involved in bogus insurance claims.
The regulator has now published a list of areas where firms should ensure they are fully compliant. They include cold calling, breaching the ban on referral fees, acting on instructions without client approval, paying damages to third parties, and bringing claims without clients' knowledge.
The SRA's chief executive, Paul Philip, said: 'As we said in January, insurance fraud is a serious matter and we welcome the task force's report and its recommendations. We have made good progress on combating financial crime, but we know we have more to do.
'In particular, we want to remind solicitors of their responsibilities when conducting personal injury work. The consequences of failing to adhere to the code of conduct could be severe both for the client and to the profession.'
Philip added that the regulator will also be carrying out a 'comprehensive review' of the personal injury market in 2016 to 'further to our understanding of this area of the market'.
The IFT report addressed a need to stop 'fictitious' or 'exaggerated' claims costing the insurance industry over £3bn.
Among a range of recommendations, the report stated that where claims are brought for minor injuries six months after the accident, the recoverable costs should be reduced by 50 per cent.
However, the report came under fire from claimant lawyers. Jonathan Wheeler, president of the Association Personal Injury Lawyers (APIL), said the taskforce had gone 'far beyond its remit'.