£4 million fine for ‘serious and intentional’ misuse of client funds

The owner and manager of former London-based law firm Kingly Solicitors has been fined over £4 million for ‘serious’ and ‘intentional’ misconduct in the largest penalty the Solicitors Regulation Authority (SRA) has ever issued. 

Nurul Miah, who is not a solicitor, was ordered to pay a financial penalty of £3,984,440, costs of £41,670 and banned from holding any position in an SRA-regulated law firm.

Investigations by the SRA revealed 310 improper transfers from client accounts to companies linked to Mr Miah, which it says were used for ‘inappropriate purposes’ such as loan repayments and to buy assets unrelated to the business. Forged statements that attempted to conceal the unauthorised transactions were also uncovered.

After closing the firm down in 2020, the SRA was able to secure £22.5 million in client money, but a shortfall of £10 million in missing funds remains. ‘We have also collected and secured 220,000 files from the various offices, including more than 90,000 wills and deeds,’ the SRA said.

Paul Philip, chief executive of the SRA, added:

“This is the largest fine we have ever issued. Mr Miah’s dishonesty impacted thousands of people. We stepped in to safeguard their interests – closing the firm, securing files and returning money to clients.

“This action concludes our investigations. We have been making sure that law enforcement are being provided with all the relevant evidence. Meanwhile, we continue to review how best to protect client funds, with further steps to be announced later this year.”

The fine was more than the £25,000 maximum the SRA can currently levy for traditional practices because Kingly Solicitors was an alternative business structure (ABS) and as such the maximum financial penalty it can impose is £50m for an individual and £250m for the entity.

Three other people connected to the firm were also subject to disciplinary procedures: consultant Lalou Tifrit was ordered to pay £28,230 in costs and disqualified from working in a regulated firm without SRA permission; Colin Buckingham was disqualified from working as a head of finance and administration in a regulated firm without SRA permission and ordered to pay £1,350 in costs; and solicitor Simon Hutcheson was fined £26,766, ordered to pay £1,350 in costs and subjected to practice restrictions.

The fine follows the SRA’s pledge to tackle the ‘significant and sustained increase’ in the number of reports it says it is receiving about solicitor misconduct. A 23% budget increase has been proposed in the organisation’s business plan for 2025/26 to enable it to deal with the ‘increasingly varied and complex nature’ of its caseload.

‘The increase in reports of misconduct is leading to more investigations – we are opening on average 40% more investigations a month,’ the SRA said. ‘While we have boosted efficiency – concluding 18 per cent more cases than a year ago – the scale and complexity of the caseload now demands further investment so we can continue to regulate effectively and maintain public protection.’

“The action taken by the SRA sends a clear message to the legal sector about the importance of appropriately handling client funds. The misuse of such funds not only undermines public trust in the legal sector but also raises concerns about the effectiveness of current client monies framework. There are practical steps firms can take to reduce the risk of such incidents—one of which is the use of Third-Party Managed Accounts (TPMAs).

“By outsourcing the handling of client money to regulated third-party providers, law firms can offer their clients greater assurance that funds are being protected and managed in line with industry standards. Like the SRA, we are committed to instilling industry practices that enhance public trust in the legal profession. That’s why the SRA’s consultation on improving safeguards around client money is both timely and appropriate.”