SRA report demonstrates widespread conveyancing fraud
A quarter of conveyancing firms have had a client attempt to commit a property fraud or money laundering, a Solicitors Regulation Authority (SRA) report has found.
However, a third admitted that they do not know how to decide whether to report a suspicion to the Serious Organised Crime Agency (SOCA), with 15% relying on “gut instinct”.
Firms said typical warning signs are identity issues, international connections, unusual financial arrangements, client behaviour and having no local connections.
If suspicions are aroused, about a quarter of firms would refuse to represent the client, while similar numbers would report to SOCA, the police or their money laundering reporting officer.
Three-quarters of the 100 firms surveyed said they would like to have more training on property fraud and money laundering.
The firms did varying amounts of conveyancing work, and were contacted between April and August last year for the report, which was discussed by the SRA’s regulatory risk committee this week.
A quarter had received a professional negligence claim relating to conveyancing work in the last two years, although only half of them had received service complaints from clients in that time.
Four out of five firms have had fewer conveyancing clients through their door as a result of the economic downturn, with income reduced enough to require cost-cutting or redundancies for two out of five firms.
Helen Venn, SRA supervision manager, says: “Financial stability will be a key consideration for the SRA this year as far as all firms are concerned, and those involved in conveyancing will be no different.”
