Solicitors regulator board mulls restricted referral plans

The Solicitors Regulation Authority has taken the next step towards deciding whether to relax rules requiring solicitors to recommend clients only to independent financial advisers.

The Standards Committee of the SRA has agreed to a consultation paper being taken to the board on 4 July 2012, which contains several proposals including evaluation of the rule that solicitors must only refer clients to IFAs.

After reviewing the paper the board will decide whether or not to push ahead with a period of consultation. Pending approval by the board, the consultation will run across July and August 2012.

Details of the paper will remain confidential until after the board meeting.

FTAdviser was first alerted to this possibility by Ian Muirhead, managing director of consultancy Sifa.

Although a relaxing of the rules would mean IFAs could lose referrals to non-independent adviser companies, some commentators argued that such a change will help advisers after the Retail Distribution Review, in which the requirements to keep the independent label could become more stringent.