It is telling solicitors not to accept business from introducers who mislead consumers about the prospect of getting loans, credit cards or other debts written off.
It believes some advertisements wrongly suggest that almost all loan or credit card agreements in place before April 2007 are unenforceable under the Consumer Credit Act and can therefore be written off.
Anthony Townsend, chief executive of the SRA, says: “We’ve noticed a sharp increase in the number of solicitors getting involved in this activity since last autumn. The SRA is currently investigating 10 firms.
“Any found to have breached Rule 1 – the core principles – of the code of conduct may face the Solicitors Disciplinary Tribunal.”
The body is liaising closely with the Claims Management Regulation Monitoring and Compliance Unit at the Ministry of Justice, which regulates introducers.
Matthew Porteus, managing director of Ration Money, says consumers have a legal right to challenge credit agreements if they believe they are unfair and that solicitors should only work with reputable claims management companies.
He adds: “It’s completely irresponsible for companies to make the type of misleading statements that the SRA has identified. We have been alarmed about this issue for some time.
“Consumer protection is not a loophole and some leading solicitors and barristers in the country are engaged in supporting a high volume of claims on our behalf.”
He says that the misleading statements the SRA has been concerned about have mainly been distributed by new entrants entering the claims management market.
He adds: “Consumers should ask detailed questions such as which solicitors will conduct the initial audit and which solicitors are members of the company’s legal panel.”