In October 2014, rule 20.1(k) will be changing and all residual client balances of £500 or less will be dealt with by firms, having met the conditions set out in rule 20.2, without the prior authority of the SRA being sought. For those balances over £500 or not going to be paid to charity, an application must be made, in the usual way, to the Professional Ethics – Guidance team.
Applications for authority under the existing rule may take up to 12 weeks and therefore your firm may decide that it is appropriate to deal with existing balances yourselves once the new rule comes into effect. If this is the case the COFA should note the decision taken and the steps taken in the meantime to trace the clients in order to return the funds to them.
The Information Commissioner’s Office (ICO) is warning barristers and solicitors to keep personal information secure, especially paper files. This follows a number of data breaches reported to the ICO involving the legal profession.
The ICO can serve a monetary penalty of up to £500,000 for a serious breach of the Data Protection Act provided the incident had the potential to cause substantial damage or substantial distress to affected individuals. In most cases these penalties are issued to companies or public authorities, but barristers and solicitors are generally classed as data controllers in their own right and are therefore legally responsible for the personal information they process.
In the last three months, 15 incidents involving members of the legal profession have been reported to the ICO. The information handled by barristers and solicitors is often very sensitive. This means that the damage caused by a data breach could meet the statutory threshold for issuing a financial penalty. Legal professionals will also often carry around large quantities of information in folders or files when taking them to or from court, and may store them at home. This can increase the risk of a data breach.
Information Commissioner, Christopher Graham, said:
“The number of breaches reported by barristers and solicitors may not seem that high, but given the sensitive information they handle, and the fact that it is often held in paper files rather than secured by any sort of encryption, that number is troubling. It is important that we sound the alarm at an early stage to make sure this problem is addressed before a barrister or solicitor is left counting the financial and reputational damage of a serious data breach.
“We have published some top tips to help barristers and solicitors look after the personal information they handle. These measures will set them on the road to compliance and help them get the basics right.”
The ICO has published the following top tips to help barristers and solicitors keep the personal information they handle secure.
Keep paper records secure. Do not leave files in your car overnight and do lock information away when it is not in use.
Consider data minimisation techniques in order to ensure that you are only carrying information that is essential to the task in hand.
Where possible, store personal information on an encrypted memory stick or portable device. If the information is properly encrypted it will be virtually impossible to access it, even if the device is lost or stolen.
When sending personal information by email consider whether the information needs to be encrypted or password protected. Avoid the pitfalls of auto-complete by double checking to make sure the email address you are sending the information to is correct.
Only keep information for as long as is necessary. You must delete or dispose of information securely if you no longer need it.
If you are disposing of an old computer, or other device, make sure all of the information held on the device is permanently deleted before disposal.
The ICO is currently working with The Bar Council to update the Information Security Guidance provided to Barristers in England and Wales.
The ICO website includes further guidance on the security measures that should be in place when handling personal information. The ICO has also published a blog explaining the importance of encryption and the options available to barristers and solicitors who need to encrypt their data.
The Law Society has updated its practice note on mortgage fraud reflecting changes to the law and publications.
The practice note highlights the warning signs of mortgage fraud and outlines how law firms can protect themselves and identify when a client may be trying to engage in mortgage fraud.