Nineteen law firm compliance officers for finance and administration (COFA) faced disciplinary action in the year to March 2019 according to figures released by accountancy firm Hazlewoods. This was the highest number of referrals to the Solicitors Disciplinary Tribunal (SDT) since the role of COFA was established in 2013 the Law Society Gazette has reported.
Andy Harris, a partner at Hazlewoods, told the Gazette that the rise in referrals to the Tribunal suggests that the Solicitors Regulation Authority (SRA) is taking more action to stamp out irregularities as part of its crackdown on financial mismanagement.
“Given the huge sums of money some law firms hold on behalf of clients, there is a huge burden on COFAs to ensure no mismanagement is happening. In a worst case scenario, theft or money laundering can occur if COFAs take their eye off the ball,” Andy Harris told the Law Society Gazette.
The SRA’s guidance for COFAs states that they are responsible to ensure that their firm, its managers and employees comply with any obligations imposed upon them under the SRA’s Accounts Rules and promptly report any breaches.
“Being a COFA involves significant accountability,” said James Burgoyne, Director – Claims & Technical, Brunel Professions. “They are responsible for firms’ financial management and client money. As such, they can find themselves in the firing line with the SDT if anything goes wrong on their watch, even if they were not personally involved.”
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