How to stay compliant when onboarding new clients part 1: A guide to conflict checks 

When onboarding new clients, one of the most essential steps for law firms is performing conflict checks. This process helps ensure compliance with legal and regulatory standards and, more importantly, safeguards the integrity of your practice. Conflict checks serve to identify any potential conflicts of interest before legal representation begins.

By failing to address conflicts upfront, law firms can risk disciplinary actions from regulators, including the Solicitors Regulation Authority (SRA), as well as damage their professional reputation.  

For more information, please visit the SRA conflict of interest here.

Why conflict checks are crucial 

Conflict checks are a fundamental aspect of the SRA’s Code of Conduct, which mandates that solicitors avoid conflicts of interest in all professional matters. The risk of overlooking a conflict is not just regulatory—it’s also ethical. A conflict of interest can compromise your firm’s ability to act in the best interests of clients and undermine the legal process. 

For instance, if a law firm were to represent two clients with opposing interests without identifying the conflict, it could lead to the disqualification of the firm from handling the matter. Further, the SRA could impose penalties, including fines or a referral to the Solicitors Disciplinary Tribunal, potentially resulting in the loss of a practising certificate. 

Common types of conflicts of interest 

Conflicts can arise in many situations, but the following are the most common in law firms: 

1. Client-to-client conflicts: 
   This is when two or more clients of the same firm have opposing interests in the same or related matters. For example, one client may be suing another, and your firm cannot represent both parties. 

2. Former client conflicts: 
   A law firm must not represent a new client if their interests are adverse to a former client, where confidential information from the previous relationship could be used to the disadvantage of the former client. 

3. Personal conflicts: 
   Conflicts also arise when a solicitor or a member of the firm has a personal interest in a case. This could be related to financial interests or relationships that might affect their ability to provide independent legal advice. 

4. Organisational conflicts: 
   Large firms often work with numerous clients from various sectors. The risk of conflicts increases when a firm represents different clients with interests that could potentially clash, such as mergers and acquisitions within the same industry or representation of competing companies. 

By identifying these conflicts early, law firms can avoid serious legal and ethical breaches.

Best practices for conflict checks 

To ensure that conflict checks are thorough and effective, firms should implement the following best practices: 

1. Conduct conflict checks at the start of each matter: 
   Conflict checks should not be a one-time task but a continuous process. They should be conducted as part of the matter intake process, but also at key milestones, such as before hearings, settlements, or even upon receiving new instructions. 

2. Set up automated systems: 
   Automating conflict checks through case management software can save time and reduce human error. For example, Osprey Approach enables firms to automatically flag potential conflicts during case creation, ensuring that no client or case goes unchecked. 

3. Create a standardised workflow for conflict checks: 
   Developing a clear and consistent procedure for managing conflict checks will help ensure they are completed thoroughly. Document the process for checking conflicts, including what information needs to be gathered, who is responsible for running the checks, and what steps should be taken if a conflict is found. 

4. Train your team on conflict identification: 
   Lawyers and employees should be regularly trained to identify potential conflicts. This includes understanding the nuances of conflicts of interest, such as when a conflict may arise from an indirect relationship (e.g., a lawyer’s personal connection to a client). 

5. Ensure transparency with clients: 
   Clients should be informed of any potential conflicts and asked to consent to the firm proceeding with the matter. Transparent communication will help maintain trust and allow clients to make informed decisions. 

6. Document everything: 
   Keep thorough records of the conflict check process, including any conflicts identified and the actions taken to resolve them. This documentation acts as a safeguard in case of future investigations or client complaints. 

By using case management software like Osprey Approach, firms can automate the tracking and documentation of search results. Digital records ensure that every check is logged accurately, reducing manual errors and providing a clear audit trail for compliance purposes. causing potential issues with financial oversight, but firms with outdated systems may find this difficult.

How Osprey helps law firms with conflict checks

Effective conflict management requires a reliable, structured process—and Osprey Approach provides law firms with the tools to ensure compliance and efficiency.

Automated conflict identification
Osprey Approach includes a conflict-of-interest check tool that guides users through a structured process to identify potential conflicts. The system evaluates various factors and presents a conflict score to help determine whether a conflict exists before proceeding.

Centralised client information
All client and matter data is stored in a centralised system, making it easier to cross-reference new clients and matters against existing records. This reduces the risk of oversight and enables faster, more accurate conflict checks.

Structured conflict check process
Osprey enforces a predefined conflict check workflow, ensuring that checks are completed before a client is formally added to the system. This structured approach helps firms comply with regulatory requirements and maintain consistency in their conflict-checking process.

Streamlined client onboarding
Osprey simplifies the client intake process by integrating conflict checks into a structured workflow. With pre-built forms and templates, firms can automate much of the process, ensuring that all necessary compliance checks are completed efficiently.

Beyond conflict checks, Osprey also supports ID verification, anti-money laundering (AML) checks, and verification of funds (VoF) through its integration with InfoTrack. This enables firms to conduct all essential onboarding compliance checks in one place, reducing administrative burdens and ensuring a thorough, compliant process from the outset.

Staying compliant with conflict checks 

Conflict checks are a critical part of staying compliant with the SRA’s Code of Conduct. By establishing a consistent process, using the right tools, and regularly training staff, law firms can reduce the risk of conflicts and ensure they are meeting their regulatory obligations. 

Osprey Approach offers an automated, flexible solution that simplifies conflict management. By integrating automated conflict checks into the firm’s case management process, Osprey helps firms stay ahead of compliance risks while ensuring transparency and accountability. 

Ensuring compliance doesn’t have to be a burden—it’s about building a solid foundation for the firm’s operations, protecting your reputation, and maintaining your clients’ trust. 

Book a consultation to discover how Osprey Approach can help you effectively complete conflict of interest checks.  

For further advice and best practices you can view parts one and two of our SRA Conflict of Interest guides. 

Disclaimer  

This guide is for informational purposes only and does not constitute legal advice. For detailed guidance on the SRA Conflict of Interest Rules, please visit the official Solicitors Regulation Authority website.