Not content on causing enough damage to sink an entire industry already, the Ministry of Justice’s (MoJ) latest tactic to shake the core of personal injury firms into panic has been to call for claims management companies (CMC) to reveal their financial figures and dealing with personal injury firms, since the inception of the Jackson reforms.
According to the Law Gazette, the MoJ have asked CMC’s for copies of their invoices, descriptions of business models and details of each company’s panel of solicitors as they bid to enforce the changes which were implemented in from the 1st of April 2013, which has left some personal injury firms questioning their connections with CMC’s.
With penalties for infringing the new laws scaling from £2,000 fines it is no wonder some smaller firms within the industry are now backtracking to ensure every ‘i’ is dotted and ‘t’ crossed, as such punishment could spell the end for them as an operating firm.
Michelle Garlick, who is the head of regulatory compliance for national firm Weightmans, has said law firms should be aware of the information that is being shared.
She told the Gazette: “As part of a firm’s own due diligence and monitoring, firms should be asking the CMCs they have agreements with about the MoJ questionnaire.
“Have they completed it and returned it to the MoJ? Would they be prepared to let the firm see a copy of the reply? If not, why?”
She went on to reassure firms that as long as they have completed the necessary documented risk of assessment of their relationships with CMCs then they would have nothing to worry about.