Q&As

Am I allowed to transfer my seller client’s sale proceeds from a client account to a third party firm of solicitors directly in relation to a matter in which I am not acting eg an unrelated property purchase?

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Published on LexisPSL on 22/12/2016

The following Practice Compliance Q&A provides comprehensive and up to date legal information covering:

  • Am I allowed to transfer my seller client’s sale proceeds from a client account to a third party firm of solicitors directly in relation to a matter in which I am not acting eg an unrelated property purchase?

You must not provide banking facilities through a client account. Payments into, and transfers or withdrawals from, a client account must be in respect of instructions relating to an underlying transaction (and the funds arising therefrom) or to a service forming part of your normal regulated activities.’

The SRA published a warning notice on improper use of a client account as a banking facility in December 2014, which was updated in August 2018. The warning notice is accompanied by a number of case study examples.

Case study 4 (Unconnected payments from client account) gives the example of a firm that has acted on the sale of properties for a development company and then paid the proceeds from client account to a variety of third parties, including

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