Executive summary
Our mission is to drive trust and confidence in legal services. A key part of that trust is our work protecting the public through setting high professional standards and taking action when things go wrong. This report provides insights and trends from our data on this work during the 2023/24 year. The topics and highlights covered in this report are set out below.
Setting the standards the public expects
We are here to make sure anyone entering the profession has the right practical skills and knowledge to be a solicitor. We introduced the Solicitors Qualifying Examination (SQE) in 2021 as a single assessment for all aspiring solicitors. The 2023/24 year saw:
- Independent expert review concluding the assessment was fair and reliable.
- An increase to 2,600 in the numbers admitted to the profession through the SQE route – almost a third of those who qualified. For the first time, the number of individuals admitted to the profession through the previous route, the Legal Practice Course, decreased.
- Solicitor apprentices grow in popularity – compared to 2022/23, the number of registrations rose by approximately 75% to 1,350, and solicitor apprentice candidates admitted to the profession (201) more than tripled.
Delivering safe and innovative legal services
We assess firms to make sure they are suitable to provide legal services. As well as protecting the public, it is also in the public interest that we support a thriving, competitive legal sector. We aim to make decisions on new entrants into the legal sector swiftly, while being open to new and innovative models that could benefit the public.
The data in 2023/24 showed:
- A continued trend of a consolidation in the sector; overall, firm numbers have reduced by more than 1,000 compared to 2017/18. And, since 2019/20, there have been between 110 and 140 mergers and acquisitions each year.
- Conversely, there has been a continued rise in the practising population, which, in October 2024, reached another all-time high of 171,000.
- The adoption of alternative business structures (ABS), which allow non-lawyers to own and invest in legal businesses, continued to gain ground. ABS licences were held by 14% of firms in 2023/24, an increase of six percentage points when compared to 2017/18.
- Against a target of 90%, we completed 91% of high-risk firm applications within six months and medium-risk applications within three months.
Identifying and acting on risk
We are developing a more agile, data-driven and risk-based approach to regulation, while also being more proactive with our investigations work. Key themes in this area in 2023/24 included:
- The collapse of law firm SSB, which had significant negative consequences for the public. This, along with other developments in the market, has led us to focus more deeply on how the high-volume consumer claims market is working. In 2023/24, we investigated 84 high-volume consumer claims relating to 48 different firms and closed down four firms carrying out this type of work to protect the public.
- In response to larger firm failures, including Axiom Ince and changing risks in the market, we launched our Consumer Protection Review and associated discussion paper in February 2024, focused on potential changes we could make to better protect client money.
- We are shifting to a more proactive approach to investigations – alongside our proactive focus on firms operating in the high-volume consumer claims market, in 2023/24 we significantly increased our work to address risks around money laundering and our Transparency Rules.
Working with the sector on key issues
Engaging with solicitors and firms is vital to strengthening compliance and deepening our understanding of the issues affecting firms. In 2023/24 we:
- responded to 26,000 ethics-related concerns
- strengthened our support for the in-house sector by publishing key guidance, which we developed with in-house practitioners
- provided support to firms on anti-money laundering (AML) rules, with 21,000 views on AML-related webinars.
Taking disciplinary action when standards fall short
Where solicitors and firms fail to meet the high standards we and the public expect, we step in to protect the public. In 2023/24 we:
- took regulatory action in 1,069 cases – approximately a third more than the previous year, while we issued double the amount of fines. This uptick reflects our more proactive approach to investigation
- received the highest volume of reports of concern in seven years – 11,852. This is an 8% increase compared to 2022/23 (10,963 reports)
- hit timeliness targets for case resolution, despite these increasing volumes. We closed 93% of cases in 12 months and 95% of cases within 18 months. We met our 24-month closure target (98% of cases) in three of four quarters
- prioritised improving both the timeliness and quality of our investigations and enforcement work and reducing the number of longstanding investigations. We made good progress on this: in October 2023, we had 161 cases which were more than 24 months old. We reduced this to 60 such cases by October 2024
- intervened into and closed down 59 law firms due to significant and immediate risks to clients and the public, compared to 65 interventions in 2022/23. In general, we have seen an increase in the number of interventions we are carrying out, as well as more which are large-scale.
Focusing on diversity and inclusion
Embedding equality, diversity and inclusion (EDI) across all our work is vital to our role as a regulator. Key work in this area in 2023/24 included:
- Working with the SQE provider, Kaplan, to ensure reasonable adjustments were available for disabled candidates. The SQE annual report indicated that for assessments between July 2023 and July 2024, disabled candidates performed as well as or better than those without a disability.
- Publishing a significant piece of research which looked at the reasons why we see overrepresentation of Black, Asian and minority individuals in our enforcement processes. The findings have provided valuable insight, but the picture is complex.
In addition to this report, we have published core data and additional narrative in relation to the topics discuss above.