With the legal sector increasingly embracing AI and technology, solicitors must ensure that these tools are not only effective but also comply with regulatory requirements and professional standards. Below are key compliance tips for solicitors looking to integrate AI and technology into their practices.
Before purchasing any new legal AI technology, it is essential to have a clear understanding of what you expect the product to achieve. Review the product specifications carefully to ensure that they meet your needs. Ensure the product is fully demonstrated to verify its functionalities and if possible, speak with someone already using the technology to get a real-world buyer’s perspective. Compatibility with existing systems is another crucial consideration. The last thing you want is to invest in a product that conflicts with your current systems or causes operational disruptions.
While there is no specific guideline for purchasing lawtech at present, the UK Government has issued guidance for the adoption of AI in the public sector, setting high ethical standards. This can serve as a useful benchmark for private sector organisations, including law firms. The government’s goal is to ensure the ethical deployment of AI across sectors, promoting transparency, accountability and fairness. Law firms should seek to follow these guidelines when purchasing technology to ensure ethical practices and compliance.
Law firms are free to use any technology they deem appropriate for their operations, but they must remain compliant with SRA principles and standards. This includes understanding the legal framework for technology, particularly AI. For instance, solicitors should ensure that any AI tools they use are in line with existing regulatory requirements, such as data protection laws and professional conduct rules.
Senior leadership plays a pivotal role in this process. Compliance Officers for Legal Practice (COLPs) should be responsible for ensuring regulatory compliance when new technology is introduced. In addition, board oversight of the purchasing process and ongoing usage is critical for managing the risks associated with technology adoption and failure.
A solid governance framework is vital to ensuring responsible AI adoption. Key components include:
Technology can help law firms deliver services in innovative ways, such as through platforms where clients are directly connected with solicitors. However, it is critical to ensure these platforms comply with all regulatory obligations. Law firms must undertake due diligence to verify that platforms meet all legal and professional standards.
For instance, law firms cannot accept client referrals from platforms if the platform acquired those clients in ways that violate the SRA’s rules. Specifically, unsolicited client approaches for legal services are prohibited. Also, when it comes to personal injury claims, solicitors should ensure that any payments made for access to platforms do not violate prohibited referral fees under the <span class="news-text_italic-underline">Legal Aid, Sentencing and Punishment of Offenders Act 2012</span>, particularly Sections 56-60.
Many law firms are transitioning to cloud-based storage solutions to securely store client information, eliminating the need for paper records. If your firm chooses to store client information digitally, it is essential to ensure that the technology complies with the Code of Conduct for Firms, which requires confidentiality and data security.
Key compliance considerations for storing client information include:
Electronic ID verification processes are becoming increasingly common and can help law firms meet their anti-money laundering obligations. These processes can effectively replace traditional methods of verifying client identity, offering a more efficient and accurate solution.
However, it is essential to ensure that these electronic verification tools are compliant with legal and regulatory obligations, including data protection and money laundering regulations. Firms should also be transparent with clients about the verification process, ensuring clients understand how their personal data will be processed.
In an increasingly digital world, data privacy has become a significant concern for consumers. Clients are more aware than ever of their privacy rights and firms must be mindful of this when using AI and other technology to handle client data. Failure to comply with data protection laws can lead to reputational and financial damage.
Beyond basic compliance with data protection laws, firms should think critically about how they handle and use client data. Consumer trust can be easily eroded if clients feel their data is being used in ways they didn’t expect or consent to. Solicitors should ensure that clients are informed about how their data will be used, especially when automated decision-making or profiling is involved. The Information Commissioner’s Office (ICO) provides excellent guidance on data protection, including the requirements for AI-based products.
While lawtech offers efficiency and innovation, not all clients will be comfortable with or able to use these technologies. Solicitors must ensure that clients are not excluded from accessing legal services simply because they are unfamiliar with or unwilling to use digital tools.
It is essential that clients understand their options, have the ability to make informed decisions about their legal matters and are given alternative ways to interact with the firm when necessary. For vulnerable consumers, special care should be taken to ensure that risks associated with exploiting their vulnerability are identified and mitigated.
Although legal technology can enhance services, it may malfunction or fail to perform as expected, leading to operational, financial and reputational consequences for the firm and its clients. Firms must be clear on their responsibilities in the event of technology failure, including who clients should turn to for recourse.
Contracts with technology suppliers should clearly define liability and ensure that clients are aware of the firm’s responsibilities when using AI or other technologies. It is important to set expectations upfront with clients regarding the use of technology and the potential risks involved.
Finally, cybersecurity remains an essential consideration when adopting any new technology. The National Cyber Security Centre (NCSC) offers valuable resources for law firms, especially small businesses, on protecting digital systems from cyber threats. Firms should stay up-to-date with the latest cybersecurity best practices to ensure that they are effectively managing and protecting client data.
By following these compliance tips, it would be possible to responsibly integrate AI and other technology into their legal practices, ensuring that they stay compliant with regulations and continue to serve their clients’ best interests.
