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Law Society credit licence renewed for two years

PN 108/03    4 August 2003

The Law Society's group consumer credit licence has been renewed for a further two years by the OFT.

The Society's previous licence, which was also for a two-year period, expired on 2 August 2003. The licence was renewed for two years, rather than the standard five years, because of concerns regarding its complaints and disciplinary procedures. However the Law Society complaints handling body, the Office for the Supervision of Solicitors (OSS), is putting in place measures to deal with the increasing number of complaints and improve the quality of their service.

Concerns originally came to light in 1999 regarding complaints procedures and customer care. The Society's licence has been renewed on a short-term basis since then, initially for one year periods and subsequently a two year period, reflecting improvements that had been made. The decision to renew for a further two years will allow sufficient time for the OSS’s new provisions to take effect.

John Vickers, OFT Chairman, said: 'The public interest is best served by renewing the group credit licence of the Law Society for a further two years. Over that period, which will see the independent review of the regulatory framework for legal services, the Society’s complaints resolution service will need to get better.'

NOTES

1. Under the Consumer Credit Act 1974, a group licence can be issued to a body if the OFT is satisfied that the public interest is better served than by obliging those concerned to apply for individual standard licences. Applicants for a group licence have to satisfy the OFT that they have in place adequate means to monitor the fitness of those covered by the licence and can investigate complaints and take appropriate disciplinary action.

2. The Law Society for England and Wales's group licence applies to activities arising in the course of practicing as a solicitor.

3. The OFT is currently reviewing the group licensing regime as a whole (see PN 15/02). The OFT expects to report on this in the autumn.

4. On 24 July, the Department for Constitutional Affairs published a report on competition and regulation in the legal services market. The report indicates that the current framework does not meet the demands of today's market place and the needs of consumers. It announced an independent review of the regulatory framework for legal services which is to make recommendations by the end of 2004.

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