MoJ bans referral fees outright

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  • "Well in excess of 80% (probably over 90%) of all RTA cases are already subject to a fixed fee regime, so hourly rates simply do not come into it."
    This is precisely the problem. The fixed costs were set at a level that assumed the work would be done by skilled solicitors charging (jn those days) £150 per hour.
    In fact the vast majority of routine p.i. cases are handled by unqualified numpties paid £10 per hour but charged out at 10 or 20 times that amount.
    This leaves a vast profit in the fixed costs regime - so vast, that out of a typical costs figure of £1,300 the solicitors can afford to pay half in referral fees and STILL come out on top.
    The government were conned into agreeing fixed costs that were way too high, and they need to be reduced by 50% or more. This would bring down premiums - and get rid of referral fees as a side-effect - far more quickly than the proposed ban on referral fees, which will simply be circumvented by the parasites who inhabit this murky world.

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  • High street Solicitors are so bad at marketing and generally running a small business that the banning of referral fees must ultimately be a good thing - it might force them to be more entrepreneurial in drumming up business. There is a huge unserved market out there. Solicitors need to think of SELLING their services eg for every conveyancing client did you draft their wills? If not why not? Keep in touch with them with regular newsletters - don't just forget about them when the job is done. Sponsor fetes etc at local schools. Keep in touch with your local newspaper and advertise. I could go on!

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