SRA warns law firms over poor practices and transparency failures in high-volume claims market
The Solicitors Regulation Authority has issued a formal warning notice to law firms and solicitors over the use of ‘no win, no fee’ arrangements, citing widespread concerns about how high-volume consumer claims are being marketed and managed.
The regulator said the warning follows mounting evidence of poor practice across the sector, with risks to consumers ranging from unclear costs to firms placing their own commercial interests ahead of clients. The notice highlights the need for greater transparency, stronger safeguards and clearer communication with clients about how such claims operate.
As of 31 December 2025, the SRA had 83 open investigations involving 72 firms active in the claims market. A further six investigations have already been closed. The regulator said additional concerns were also identified through its recent thematic review of the sector, reinforcing the need for regulatory intervention.
Key issues outlined in the warning include firms failing to clearly explain what fees clients may have to pay if a claim succeeds, as well as the potential costs they could still face if it does not. The SRA also raised concerns about firms compromising client interests by prioritising profitability, failing to carry out adequate due diligence on third-party referrers, and not properly managing the financial safeguards required for ‘no win, no fee’ arrangements.
The notice stresses that firms must exercise caution when using the phrase ‘no win, no fee’ in marketing and advertising. It states that proactive steps are required to ensure clients fully understand the reality of these arrangements. Firms are expected not only to provide clear information, but also to check that clients have understood it and to offer opportunities for questions and clarification.
Sarah Rapson said concerns about the high-volume consumer claims market have been repeatedly raised by stakeholders and remain a regulatory priority. She said the expectations set out in the warning notice should not come as a surprise, adding that some firms are failing to meet their obligation to act in clients’ best interests and comply with professional standards.
The SRA said it is using all available regulatory tools to address these issues, including enforcement action where necessary, alongside efforts to promote compliance and protect the public.
In 2025, the regulator took the unusual step of requiring firms operating in the high-volume claims sector to complete a mandatory declaration confirming their understanding of, and compliance with, regulatory rules. The SRA said the information received is still being reviewed to identify where firms may need support, or where further action may be required.
The warning follows a discussion paper issued in September 2025, which identified five key challenges in the operation of the claims market. The regulator is now assessing responses, alongside consumer research, to inform future steps aimed at improving outcomes for consumers.