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SRA board approves restricted referrals

SRA board approves restricted referrals

The Solicitor Regulation Authority’s (SRA) has agreed to allow solicitors to make referrals to restricted advisers.

The SRA board decided today that solicitors should no longer have to make referrals to independent financial advisers as the term independent was no longer appropriate.

Earlier this week, the SRA announced it had recommended the board should allow solicitors to refer to any type of adviser provided they had conducted due diligence on them and discussed it with their clients.

The SRA launched a consultation earlier this year on solicitors referrals in light of the Financial Services Authority (FSA) redefining independence.

In its consultation paper published in July, the SRA outlined three possible options for the future of solicitor-adviser referrals having been invited to reconsider its stance by the FSA which conceded that its post-RDR definition of independence might be more onerous than the one currently used by the SRA.

The three options proposed by the consultation were:

  • maintain its current rules that only independent advisers can receive referrals
  • scrap the independent requirement altogether
  • clients choose what type of adviser they want having discussed it with their solicitor

The board has backed option three.

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