Qualified Lawyers Transfer Scheme (QLTS) Professional Conduct, Solicitors Accounts and Skills Syllabus

Professional Conduct, Solicitors Accounts and Skills syllabus — full chapter and topic list

Expand any chapter to see its topics and sub-topics. This is the whole examinable outline for Professional Conduct, Solicitors Accounts and Skills in Qualified Lawyers Transfer Scheme (QLTS), not a summary of it.

1. 1

   Principles of Professional Conduct

   4 topics

   • SRA Principles and Code of Conduct
     • Core mandatory principles
     • Acting with integrity and independence
   • Conflicts of interest
     • Own interest and client conflicts
     • Confidentiality versus disclosure
   • Client care and complaints handling
   • Regulation and the SRA framework
2. 2

   Financial Crime and Regulatory Duties

   4 topics

   • Anti-money laundering obligations
     • Customer due diligence
     • Suspicious activity reporting
   • Proceeds of Crime Act duties
   • Financial services regulation for solicitors
   • Undertakings and their enforcement
3. 3

   Solicitors Accounts

   4 topics

   • SRA Accounts Rules framework
     • Client money and office money
     • Client account requirements
   • Recording and reconciliation
     • Double entry bookkeeping
     • Breaches and remedying
   • Interest on client money
   • Accountants' reports
4. 4

   Practical Legal Skills (OSCE)

   4 topics

   • Client interviewing and attendance notes
     • Eliciting facts and advising
     • Identifying client objectives
   • Advocacy and submissions
     • Bail and interim applications
     • Structuring oral submissions
   • Legal drafting
   • Legal writing and research
     • Letters of advice
     • Practical legal research methods

Professional Conduct, Solicitors Accounts and Skills flashcards for Qualified Lawyers Transfer Scheme (QLTS)

21 of 49 cards from the Professional Conduct, Solicitors Accounts and Skills deck — real questions with worked answers.

1. What are the seven SRA Principles that solicitors must uphold under the SRA Standards and Regulations 2019?

   Acting (1) in a way that upholds the constitutional principle of the rule of law and proper administration of justice; (2) in a way that upholds public trust and confidence in the profession; (3) with independence; (4) with honesty; (5) with integrity; (6) in a way that encourages equality, diversity and inclusion; and (7) in the best interests of each client.

2. When the SRA Principles conflict, which takes priority and why?

   The Principle that best serves the public interest prevails, especially the public interest in the proper administration of justice. So a wider public-interest Principle (e.g. Principle 1, rule of law) overrides the duty to act in a client's best interests (Principle 7) where they conflict.

3. Distinguish 'honesty' from 'integrity' as SRA Principles, including the test for each.

   Honesty is tested objectively (Ivey v Genting): ascertain the person's actual state of knowledge/belief, then judge whether conduct was dishonest by the standards of ordinary decent people. Integrity is a broader concept of adherence to the ethical standards of the profession (Wingate v SRA) and can be breached without dishonesty — e.g. recklessness or failing to maintain professional standards.

4. What is the general rule on acting where there is a conflict of interest between two or more clients (own-client conflict)?

   You must not act if there is an own-client conflict or a significant risk of one (Code para 6.2), unless one of two exceptions applies: (a) the clients have a substantially common interest, or (b) the clients are competing for the same objective. In both exceptions you also need informed written consent, effective safeguards, and reasonable belief it is in all clients' best interests.

5. Define 'substantially common interest' and 'competing for the same objective' as exceptions to the conflict rule.

   Substantially common interest: a clear common purpose between the clients and a strong consensus on how it is to be achieved. Competing for the same objective: two or more clients competing for an 'objective' which, if attained by one, makes it unattainable to the others — e.g. bidding for the same asset, company or property at auction.

6. What is an 'own interest conflict' and can it ever be waived by client consent?

   An own interest conflict is a conflict (or significant risk of one) between your own interests and the client's interests (Code para 6.1). Unlike own-client conflicts, it can NEVER be waived by consent — you must not act at all.

7. State the rule on confidentiality versus the duty of disclosure where two clients' interests conflict.

   The duty of confidentiality (para 6.3) to a current or former client always outranks the duty to disclose (para 6.4). You must not act for a client where you hold confidential information material to that client's matter from another (former/current) client, unless effective safeguards (e.g. information barrier) are in place and consent is given, or the client gives informed consent in writing.

8. What information must a solicitor give clients about complaints at the time of engagement (client care)?

   Clients must be told in writing, at the time of engagement: how to complain (the firm's complaints procedure), who to complain to and what to do if dissatisfied; their right to complain to the Legal Ombudsman, the timeframe for doing so, and how to make the complaint; and (if relevant) their right to complain to the SRA about misconduct.

9. What are the time limits for a client to bring a complaint to the Legal Ombudsman?

   The client must complain to the firm first. They may then go to the Legal Ombudsman within: six months of the firm's final response, AND either within one year of the act/omission complained of OR within one year of when the client should reasonably have known there was cause for complaint.

10. Within what period must a firm acknowledge and respond to a client's complaint, and what must clients be told if a complaint is not resolved?

    Firms must deal with complaints promptly, fairly and free of charge. If a complaint is not resolved to the client's satisfaction within eight weeks, the client must be informed in writing of their right to complain to the Legal Ombudsman, the timeframe, and full contact details.

11. What is the SRA and what is its relationship to the Law Society?

    The Solicitors Regulation Authority (SRA) is the independent regulatory arm of the Law Society of England and Wales. It regulates solicitors and law firms (sets standards, authorises firms, enforces rules), while the Law Society is the representative/professional body. This separation is required by the Legal Services Act 2007.

12. Under the Legal Services Act 2007, who is the oversight regulator above the SRA and what are the 'reserved legal activities'?

    The Legal Services Board (LSB) is the oversight regulator. The six reserved legal activities are: (1) the exercise of a right of audience; (2) the conduct of litigation; (3) reserved instrument activities (conveyancing/probate-type document preparation); (4) probate activities; (5) notarial activities; and (6) the administration of oaths.

13. List the eight regulatory objectives in section 1 of the Legal Services Act 2007.

    (1) Protecting and promoting the public interest; (2) supporting the constitutional principle of the rule of law; (3) improving access to justice; (4) protecting and promoting the interests of consumers; (5) promoting competition in legal services; (6) encouraging an independent, strong, diverse and effective legal profession; (7) increasing public understanding of citizens' legal rights and duties; and (8) promoting and maintaining adherence to the professional principles.

14. Name the principal UK statutory instruments governing anti-money laundering obligations for solicitors.

    The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLR 2017, as amended), underpinned by the Proceeds of Crime Act 2002 (POCA) and the Terrorism Act 2000. The SRA is the AML supervisor for most solicitors.

15. What are the three elements of Customer Due Diligence (CDD) under the MLR 2017?

    (1) Identifying the client and verifying their identity from reliable, independent sources; (2) identifying any beneficial owner and taking reasonable measures to verify their identity (including ownership/control structure for legal persons); and (3) obtaining information on, and assessing where appropriate, the purpose and intended nature of the business relationship or transaction.

16. When must Enhanced Due Diligence (EDD) be applied under the MLR 2017?

    EDD applies in higher-risk situations, including: where the client or transaction involves a high-risk third country; where the client is a Politically Exposed Person (PEP) or their family member/known close associate; in any case identified as higher risk by the firm's risk assessment; unusually complex or large transactions with no apparent economic purpose; and where the client has not been physically present for identification.

17. What are the three principal money laundering offences under sections 327–329 of the Proceeds of Crime Act 2002?

    Section 327: concealing, disguising, converting, transferring or removing criminal property from the jurisdiction. Section 328: entering into or becoming concerned in an arrangement which a person knows or suspects facilitates the acquisition, retention, use or control of criminal property by/for another. Section 329: acquiring, using or possessing criminal property.

18. What is a 'failure to disclose' offence under section 330 POCA, and to whom is disclosure made?

    Section 330 makes it an offence for a person in the regulated sector to fail to disclose where they know, suspect, or have reasonable grounds to suspect, that another is engaged in money laundering, and the information came to them in the course of business. Disclosure is by a Suspicious Activity Report (SAR), via the firm's nominated officer (MLRO) to the National Crime Agency (NCA).

19. What is the 'tipping off' offence under section 333A POCA and when does it apply?

    Section 333A makes it an offence (in the regulated sector) to disclose to a person that a SAR/disclosure has been made, or that a money laundering investigation is being or may be carried out, where that disclosure is likely to prejudice any investigation. There are defences, e.g. disclosures within an undertaking/group or to dissuade a client from criminal conduct.

20. Explain the 'appropriate consent' / defence mechanism for an authorised disclosure under POCA (the moratorium period).

    Making an authorised disclosure (SAR) to the NCA before acting provides a defence. After a SAR seeking consent, there is a 7 working-day 'notice period' for the NCA to respond. If consent is refused, a 31 calendar-day 'moratorium period' begins during which the transaction must not proceed; if no refusal is given within 7 working days, consent is deemed granted.

21. How do solicitors generally avoid needing FCA authorisation when carrying on regulated financial activities?

    Most solicitors rely on the Part XX exemption of the Financial Services and Markets Act 2000 (FSMA) for 'exempt regulated activities' carried on incidentally to professional legal services and supervised by a Designated Professional Body (the Law Society/SRA). This is governed by the SRA Financial Services (Scope) Rules and (Conduct of Business) Rules. Mainstream investment business still requires FCA authorisation.

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