Solicitors Accounts III: Third-Party Managed Accounts
Description
An extensive overview of Third-Party Managed Accounts (TPMAs), which solicitors can use to hold client funds via an independent, authorized provider, acting similarly to an escrow service. The text explains that because the solicitor does not directly hold the money, TPMA funds are exempt from standard SRA Accounts Rules but require solicitors to fulfill specific due diligence and client communication obligations. While TPMAs offer significant benefits like cost savings and enhanced security by transferring risk to a regulated third party, drawbacks include potential additional costs for clients and the solicitor's loss of direct control over disbursements. Solicitors must inform clients that TPMAs are regulated by the Financial Conduct Authority (FCA), not the Solicitors Regulation Authority (SRA), and must notify the SRA upon adopting this arrangement.
United States
