Law Society to lobby government and FSA on HSBC solicitor panel
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The Law Society is planning to raise its concerns about HSBC’s conveyancer panel with the Financial Services Authority and business secretary Vince Cable.
The society says HSBC’s decision to only use solicitors from a panel of 42 firms and to offer customers incentives to use the firms will prevent many from employing a local solicitor of their choice.
HSBC says customers remain free to choose their own solicitor but, because it will use a panel firm for its own legal work, experts are warning this will increase costs for consumers and lead to delays.
Desmond Hudson, chief executive of The Law Society, says: “The disabled, those living in rural areas or even those wishing to simply use their family solicitor will have little choice but to opt for the same solicitor as HSBC, or pay twice - for their own solicitor as well as HSBC’s legal fees.”
The Law Society says it has made the issue a priority and is raising it with the Council of Mortgage Lenders, the FSA and Cable.
The Bold Group, a network that represents high street law firms, says it has received an unprecedented outpouring of anger from members about HSBC’s decision, with some 100 firms expressing frustration at being left off the panel.
Rob Hailstone, founder of The Bold Group, says some firms have contacted their MP about the move.
He says: “Since The Bold Group launched in 2010, we have never seen a single announcement stir up such a furore among our members.
“If two firms are used, work will have to be duplicated and delays are more likely.
“There are also concerns that those unable to employ a local solicitor would find it difficult to arrange a face-to-face meeting which could increase fraud risks.”
A spokeswoman for HSBC says: “We are not restricting consumer choice. Customers will always be able to choose their own solicitor. A panel size of 42 firms is perfectly feasible for the business we are doing at the moment.”
A spokeswoman for the CML says: “Lenders are entitled to decide which firms to have on their panels to undertake business on their behalf. Their decisions will be based on the perceived risks, benefits, services to customers and costs to their business.”
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Readers' comments (2)
Ashley | 28 Feb 2012 11:59 pm
If High street lawyers did their jobs correctly then this situation would never have happened!
To many have made mistakes and missed things, now they are running to "daddy" and crying..
This is the way forward, more and more lenders are lookng at this as a way to reduce mortgage fraud and loses because of mistakes.
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Anonymous | 29 Feb 2012 2:38 pm
With respect Ashley, this move by HSBC has absolutely nothing whatsoever to do with fraud. It is about them retaining control. We recently had a client buying though us who was informed one day before exchange that HSBC would not release the completion money to their solicitor as he wasn't on their panel. It cost them £650 for an "approved" solicitor to check the work of their trusted firm. Well done to the Law Society for taking action on behalf of their members. I wish them the very best of luck in fighting what is an anti-competiton policy. Yet another example of small firms being squeezed out by large corporations...
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