Since March, firms have been busy adapting to new regulations and their subsequent effects. In a climate where virtual will witnessing via Zoom call and e-signatures have become the new normal, the ‘status quo’ simply cannot cut it any longer. What’s more, there’s growing evidence to suggest an impending second lockdown on its way. With this in mind, we take stock of key learnings from firms, compliance experts and other industry players – so we can help make sure you don’t make the same mistakes twice.
Tech Gives Firms an Edge
The common thread running through all our conversations with those in the industry has been this: firms already prioritising tech solutions had the smoothest transitions to remote working, and the least disruption to client experience during lockdown. When we spoke with Matthew Evans, Partner and Head of Private Wealth at Hugh James earlier this year, he noted that, “[Hugh James] are perhaps better placed than some other firms… as we’ve been [taking instruction] remotely for quite some time” and that “a lot of people in the profession have had to adapt quite quickly”. Those in the profession unprepared for the changes to have found themselves at a disadvantage at first, especially when considering processes such as Client Due Diligence, or onboarding.
Tech such as eIDV (electronic ID verification) not only allowed for a functioning onboarding process during lockdown, but a revolutionised one. In the competitive climate of the moment, keeping client experience as frictionless, smooth and easy as possible was, and remains, more desirable than ever. The lockdown was a period where communication with clients was paramount, and app-based eIDV solutions placed the onus on the client to further a transaction, meaning no in-person manual onboarding had to be carried out.
While you’re WFH… so are the fraudsters
Temporary measures (such as verifying ID via Zoom call) might have tided firms over, but they’re a fraudster’s dream. In the relative chaos of the past 6 months, warnings have been issued from industry bodies such as the Solicitor’s Regulation Authority to bolster source of funds verification (as criminal use of crypto currencies is set to increase) and re-examine AML measures. The HM Land Registry warned both lawyer and client to stay vigilant, as “fraudsters will try to take advantage of the pandemic to make money and this could include fraudulent attempts at selling or mortgaging property they don’t own.” When we spoke with Teal Compliance’s Amy Bell earlier this year, she recognised that “Government recommendations of social distancing will provide fraudsters with a valid excuse as to why they can’t come into the office to allow solicitors to complete KYC checks, and why they can’t provide valid ID documents.” This is where remote identification technology really becomes key to staying compliant; in removing the need for face-to-face contact, eIDV ensures that fully compliant, risk-based KYC checks are carried out, even when clients and solicitors are practicing social distancing.
Aside from the more obvious scams carried out with fraudulent documents, cyber-crime has seen a huge increase as a result of Covid-19, with eight separate email scam alerts being flagged by the SRA in a matter of days in October. Worryingly, The National Crime Agency recorded a 400 per cent increase in cyber-crime incidents in the first two weeks of lockdown alone. The Law Society emphasises the importance of firmwide uptake of Cyber Security measures in the midst of the pandemic, with “remote working one of the top three critical vulnerabilities which can result in a serious cyber incident.” With most areas of legal hit by increased rates of fraud, the introduction of preventative security technology works best when embraced firmwide, to leave no areas of weakness for fraudsters to take advantage of.
Efficiency is Everything
Thirdfort client Mishcon de Reya found themselves suddenly needing to onboard over 100 clients a month remotely when lockdown hit in March. To continue to function, they needed a way to onboard clients completely remotely, efficiently and securely. After rolling Thirdfort out firmwide, Mishcon not only were able to adapt to remote working seamlessly but also saw a significant increase in efficiency and client satisfaction. Nick West, Mishcon’s Chief Strategy Officer told us that, “since implementing Thirdfort’s data solution, Mishcon’s onboarding period - for straightforward matters - has been reduced from days to minutes with a reduction in cost and an increase in client NPS (net promoter score – a measure of client satisfaction)”.
And it’s lucky they did. With the Government’s temporary reduction of Stamp Duty Land Tax, coupled with a backlog of property transactions from the property market freeze earlier this year, conveyancers have found themselves inundated with clients. It’s not just conveyancing hit with increased client numbers- Matthew Evans noted an uptake in Wills and Probate, whereas The Law Gazette reported a 45,000 case backlog for the employment tribunal post-lockdown. The need for efficient, compliant and most importantly, secure onboarding of clients is more pressing than ever, with all areas of legal feeling the strain of not being equipped with the right tech to help them service huge influxes of clients.
To conclude, it appears obvious that the areas of law left without helpful digital solutions (whether these be eIDV providers, Cyber Security products or eSignature platforms) were those ill-equipped for the first lockdown and its effects. Furthermore, a key takeaway is that this learning can and should be applied industry-wide, in all areas of law, to make sure firms don’t fall victim to the reputational and regulatory risks attached to lockdown. From Conveyancers to full-service firms, don’t make the same mistake twice – stay compliant and become efficient if a second lockdown is imposed.
To learn how digital solutions like eIDV keep your firm competitive, read our recent article.