England: Solicitors to pay price for Axiom Ince collapse
All practising solicitors in England and Wales may have to pay up to £400 in order to cover the costs to clients following the collapse of a City law firm.
Axiom Ince was closed down by regulators last month and police are investigating allegations of a £64 million fraud.
The Law Society Gazette has calculated that each of the approximately 160,000 practising solicitors south of the border will have to stump up as much as £400 in top-up fees for the profession’s compensation fund.
The Gazette reports that regulation chiefs are mulling an additional levy to the annual contribution that solicitors pay into the compensation fund as they struggle to address the millions of pounds’ worth of potential claims stemming from the Axiom Ince case.
Paul Philip, chief executive of the Solicitors Regulation Authority, said it was “trying to work out how many people are affected and how much they have lost”.
He added: “Based on what we know, the cost of contributions to the fund is going to go up quite radically.”
Officials said that once the total amount lost in the Axiom Ince case has been established, the SRA would decide whether it could wait until next year’s autumn renewal to take increased contributions from solicitors or collect the rise mid-year.
It is thought that the regulator’s intervention into Axiom Ince will cost between £10m and £15m. A spokesman from the SRA said that figure “dwarfs the next-nearest intervention” by almost three times.