Back in December we reported that the Legal Services Board’s thematic review had called into question the issue of holding client money.
Last week the Financial Services Authority gave the go-ahead for a scheme that will allow barristers to hold client money through a third party, enabling clients to bypass solicitors and instruct barristers directly more widely.
The FSA have granted Barco, a third-party account holding client money, regulatory approval under the Payment Services Regulations.
Barristers will be able to offer a full range of services without breaching their code of conduct, which prohibits them from holding client money.
Several large chambers, including Atkin Chambers, 2 Bedford Row, 33 Chancery Lane, Erskine Chambers, 39 Essex Street and Outer Temple Chambers in London; St. Johns Buildings, Manchester; St. Johns Chambers, Bristol; 37 Park Square, Leeds and St. Philips in Birmingham will test the scheme before it is extended across the profession.
Barco is owned and operated by the Bar Council and funds are ring-fenced by Barclays Bank.
Barco chair and immediate past chairman of the bar Michael Todd QC said: “We believe that it will offer an imaginative and unique solution for clients all over the world, making it easier than ever before to work with the bar, whilst maintaining the bar’s high-quality and cost-effective services.”