First SRA-regulated law firm signs up to Bar Council’s escrow account

24 March 2016

The Legal Director has become the first law firm regulated by the Solicitors Regulation Authority (SRA) to sign up to the Bar Council's escrow account BARCO

The firm, which provides in-house lawyers to businesses on a contract basis, has become the first SRA-regulated firm to secure a waiver from the regulator to sign up to BARCO. This new service allows the firm to handle client cash without it needing to be held in a dedicated client account. Client funds are pooled into a ring-fenced Barclays account and not released from the BARCO account until they have completed the work for their client. All interest on the funds is returned to the client.  

James Mallender, Director at The Legal Director, said: "Using BARCO is a no-brainer for us because much of our work is in-house advisory. Our clients can now use us for their financial transactions and, as we're not handling their money, they have the peace of mind that their funds are completely secure. BARCO is good for business too. It broadens our service offering and keeps our costs low because the regulatory burden of maintaining a dedicated client account was complicated and expensive. It is another factor that helps set The Legal Director apart from other law firms." 

Chantal-Aimée Doerries QC, Chairman of the Bar,said: "BARCO was originally set up for barristers who do direct access work - those that are qualified to take instructions directly from clients - and for barristers instructed by international clients and international law firms. However, in recent months it has become clear there is an appetite for BARCO within solicitors' firms too. The Legal Director is the first of those firms to see the benefits of BARCO, not only for them, but for their clients." 

There is a charge for lawyers to use the service, which starts at 2% of the total cost of legal fees, and not 2% of the amount held in the account, and it decreases on a sliding scale as the fees increase, dropping to 1.75%, 1.5%, 1.25%, 1.00% then 0.75%.  

The SRA had previously agreed that it would waive requests from solicitors to use the BARCO service on a case-by-case basis, and so the Legal Director is the first firm to secure the waiver and sign up to BARCO. 

Direct Access barristers and those accepting international instructions have traditionally been BARCO's customers. The escrow account allows clients to pay a barrister without breaching rules that prohibit barristers from handling client money. However, because BARCO is a third party, secure escrow account, it is at lower risk of misappropriation than traditional law firm client accounts. 

ENDS

Notes to editors: 

What is BARCO?

BARCO is a third party company, owned and operated by the Bar Council, which manages the funds required to facilitate on-going legal services provided by lawyers in England and Wales. 

Barristers are prohibited from handling client funds under Rule C73 of the Code of Conduct in the BSB Handbook. BARCO preserves this prohibition while still enabling the Bar to offer its services to those who require them. 

Further information is available from the Bar Council Press Office on 020 7222 2525 andPress@BarCouncil.org.uk

The Bar Council represents barristers in England and Wales. It promotes:  

  • The Bar's high quality specialist advocacy and advisory services
  • Fair access to justice for all
  • The highest standards of ethics, equality and diversity across the profession, and
  • The development of business opportunities for barristers at home and abroad. 

The General Council of the Bar is the Approved Regulator of the Bar of England and Wales. It discharges its regulatory functions through the independent Bar Standards Board 

For further press information and to arrange interviews with The Legal Director please contact: 

Warren Ryland

Managing Director

Francis Ryland Limited

Mobile:  07748 156 925

Tel: 01494 726 535

E: warren.ryland@francisryland.com