Lawyers have breached rules when making claims for clients alleging they were mis-sold payment protection insurance, the profession’s regulator said yesterday.
In the worst cases, the Solicitors Regulation Authority (SRA) alleged that lawyers had submitted false claims in the hope of gaining a settlement without further investigation by lenders.
Financial watchdogs have reminded the public that the deadline for claims is two years away.
The SRA cautioned the legal profession to “make sure any applications they work on adhere to the rules”. SRA officials said they were compelled to remind law firms of their professional responsibilities regarding the claims because it had received reports of poor practice.
In addition to submitting false claims, solicitors have acted in PPI cases “without first investigating whether there is a valid claim” as well as in some instances making claims without the knowledge of clients, the authority said.
It also referred to reports of firms failing to identify clients and confirm client instructions. Lawyers were also accused of charging “unreasonable costs for a limited amount of work” in some PPI claims.
The SRA’s warning notice also reminded solicitors that they are not allowed to engage in cold calling, in other words that clients should not be approached and invited to make PPI claims.
“Making a claim for compensation over mis-sold PPI can be confusing, and people might want to seek professional advice,” Paul Philip, the authority’s chief executive, said.
He went on to warn that “a tiny minority” of solicitors “fall below the high standards we and the public expect of them”. If the SRA found “evidence that solicitors have not acted in the way they should, we will take action to protect the public”, he said.