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Concerns raised five years before law firm collapse
PM Law collapsed suddenly on 2 February, leaving hundreds of employees without work and clients stranded during legal transactions. An independent review found that concerns about the firm’s handling of client money had been reported to the Solicitors Regulation Authority (SRA) five years earlier, but warning signs were missed.
A former employee reported Proddow Mackay (Conveyancing) Limited in March 2021 over anti-money laundering checks and client funds; the SRA opened an investigation in November 2022 and closed its forensic inquiry in spring 2025. The regulator previously said up to £39.5m in client money could be missing, while a legal charity says the share of reports referred for investigation fell from 53% in 2017-18 to 15% in 2023-24. The SRA says it is changing its approach, including closer supervision of high-risk firms.
In short
- PM Law collapsed after earlier concerns were reported to the SRA.
- Up to £39.5m in client money may be missing.
- The SRA says it is changing how it regulates firms.
Steelman: both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
The review suggests the SRA should have acted sooner on a report raising concerns about client money and anti-money-laundering checks, especially given the potential scale of losses and the harm to clients and staff when the firm collapsed. The decline in reports referred for investigation may strengthen the case for more timely scrutiny and closer supervision of firms judged high risk.
The case against
A report is a warning to assess, not proof of misconduct, and regulators must investigate proportionately while distinguishing substantiated risks from allegations. The SRA did open an investigation, and its changing approach may reflect efforts to target limited resources more effectively; the reported fall in referrals alone does not establish that any particular case was mishandled.