THE Law Society of Scotland is coming under increasing pressure to drop a rule that lets solicitors keep interest accrued while dealing with inheritance money.
MSPs including the SNP's Joan McAlpine have backed a campaign by Jim Clarke from Ayr to have the loophole closed.
Guidelines south of the Border, where a separate system is in place, suggest a £20 ceiling on interest to pay for administration costs, but legal firms in Scotland have been officially told they are entitled to hold on to interest on estates' investments if the payback amounts to less than £100.
The professional body for lawyers says the sums help cover administration and other costs involved in setting up an account for money left behind by a dead person. But Mr Clarke is convinced the rule could encourage unscrupulous solicitors to under-invest for their own gain.
Ms McAlpine has written to Law Society Chief Executive Lorna Jack calling for a rethink over the rule, but Ms Jack's response was met with anger by the MSP.
Ms Jack wrote: "We do not believe it is the case that solicitors seek out a low-interest account to avoid paying interest earned to their clients.
"As you know, in the current economic environment, only very low interest rates are available and this rule has meant that firms do not have to carry out the extensive administrative tasks necessary in creating and managing designated accounts in cases where only small amounts of interest are earned.
"This ensures a timely and less bureaucratic legal service to the client. Most firms currently choose not to apply their administrative costs of handling these types of low-interest transactions, which if they did would likely outweigh any additional interest."
Ms McAlpine said law society members should consider pushing to abandon the rule. She said: "To suggest as Lorna Jack does that a three-figure sum is a small amount is not just arrogant but incorrect. The Financial Services Authority definition of a small sum was less than £10.
"It is also worrying that solicitors are able to act with such a lack of transparency, refusing to reveal where they have deposited their client's money.
"This will hardly engender trust in solicitors and I hope the reputable members of the profession will urge the society to change its stance - They should be looking out for their clients, not ripping them off."
Chartered accountant Mr Clarke, 69, a former chairman of the Scottish Local Authorities Chief Internal Auditors Group, started his campaign after dealing with the estate of his mother Agnes, of Milngavie, East Dunbartonshire, who died last year.
A spokeswoman for the Law Society of Scotland rejected Ms McAlpine's claim.
She said the society's council had decided £100 was a fair amount in current circumstances, and that, in correspondence, there had been no previous mention of the organisation considering it to be a small sum.
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