On 4 January 2012, the Solicitors Regulation Authority (the SRA) issued guidance to solicitors on their professional duties when dealing with claims relating to mis-sold payment protection insurance (PPI).
In April 2011, the High Court ordered banks to pay back up to £4.5bn in compensation to consumers over the mis-selling of PPI (see our previous blog on the subject here). The Ministry of Justice and the Financial Ombudsman Service have since provided consumers with detailed information on how to make a claim.
The SRA’s guidance reminds solicitors that they must ensure that in relation to PPI claims clients and potential clients: are not taken advantage of and do not suffer detriment; do not instruct a firm as a result of misleading information or publicity; have sufficient information to make informed decisions about instruction; and receive independent advice and a proper standard of service.
The guidance highlights that solicitors may need to tell the client about the possibility of making a claim themselves and that it is relatively straightforward to do so. It also points out that solicitors must ensure that their independence is not prejudiced by virtue of a referral arrangement and that clients are informed about any financial interest which an introducer has in referring the client.