CQS Financial Transactions Procedure (Sept25)

Management of funds received by the firm

All funds received by the firm must be handled in accordance with the SRA Accounts Rules and other relevant legislation, for example laws on anti-money laundering. File handlers will ensure that the necessary checks and consents are undertaken/obtained in relation to funds received from third parties who are not the firm’s clients.

Our procedure for managing funds received by clients

When funds are received from our named clients, they are allocated to the correct client ledger (by the accounts assistant), and the fee earner is notified that funds have been received.

Client funds must be paid directly from the clients and not via a third party (other than from a mortgage lender or giftor). If client funds are received from someone other than the client/lender then further checks would need to be undertaken which could mean the transaction is delayed.

If funds are unable to be allocated, it is referred to the financial director for review on a daily basis.

Our procedure for managing funds received from Giftors on conveyancing matters

If a third party is gifting funds in a conveyancing transaction it is essential:

• that we are informed at the outset to perform source of funds & anti-money laundering checks
• the lender has been informed at the beginning of the process
• the giftor has signed a gift waiver to confirm they are aware that they are gifting the money and will have no equity in the property (we recommend that the giftor obtains independent legal advice before signing the gift waiver to ensure they fully understand what they are signing).

It is our recommendation that the gifted funds are paid into the client’s bank account before transferring onto us. However, it is important that the accounts department are notified in case the funds are received directly from the giftor so they can be allocated without delay.

Our procedure for managing funds received from lenders on conveyancing matters

When a mortgage advance is received, it is allocated to the correct client ledger by the accounts assistant and the fee earner is notified that this has been received.

The completion date is checked, and the funds held are monitored as a priority in case completion is delayed and funds need to be returned.

Our procedure for managing funds received from other third parties

Funds received from third parties in relation to probate matters, for example DWP, are allocated to the correct ledger by the accounts assistant.

If not enough information has been sent to allocate the receipt, then it is referred to the financial director for review on a daily basis.

See our Financial Management and AML and CFT Compliance Policy  for more information.

Procedures for Transfer of funds and authorisations

Handling large volumes of client money when conducting conveyancing is a high-risk activity. In recognition of that risk the firm has implemented the following additional checks when handling funds relating to the completion of a conveyancing transaction.

1. Payments direct from office account in respect of searches and HM Land Registry fees (below £300) can be authorised by the fee earner.
2. Transfers from client and office account above must be authorised by a Director. Invoices and saved to the virtual bill tray (shared>company data>bill tray) and posted by the accounts department. The finance director will run a report twice weekly to identify any client to office transfers.

3. Payments out of the client account by cheque or bank transfer, can only be authorised by a Director.

A cheque should be requisitioned by creating a “chit” on ALB using the accounts requests system. For the reference, please enter “CHQ” and in the payee box please enter the “Payee:Description” for example “HMCTS:Probate Fee”. Please print the chit and attach the accompanying letter on the firms’ letterhead and place in the accounts tray in the post room. This will then be checked by the accounts assistant before being authorised by a Director. If authorised the cheque will be printed, attached to the letter and passed to a Director for signing.

A bank transfer should be requisitioned by creating a “chit” on ALB using the accounts requests system. For the reference, please enter “BAC” and in the payee box please enter the “Payee:Description” for example “SMDC:Council Tax”. Please then email the necessary documents to accounts (i.e., invoice) which will be checked by the accounts assistant before being authorised by a Director.

4. Only a Director can authorise the following:

a. transfer of purchase funds to vendor’s solicitor, which is done by saving all the necessary documents (vendor requisitions, CQS pre-completion check, completion statement &  Pre Exchange Review) to the completions calendar. This will be checked by the accounts assistant and authorised by a Director once the fee earner has confirmed the matter has exchanged and the funds are to be sent.

b. transfer of funds to redeem mortgage or any other charge on property, which is done by saving all the necessary documents (redemption statement, CQS pre-completion check, completion statement &  Pre Exchange Review) to the completions calendar. This will be checked by the accounts assistant and authorised by a Director once the fee earner has confirmed the matter has exchanged and sale proceeds have been received.

c. transfer of net sale proceeds to client(s), which is done by saving all the necessary documents (client bank statement, CQS pre-completion check and completion statement) to the completions calendar. This will be checked by the accounts assistant and authorised by a Director.

d. transfer in respect of SDLT, which should be requisitioned by creating a “chit” on ALB using the accounts requests system. For the reference, please enter “BAC” and in the payee box please enter the “Payee:Description” for example “HMRC:SDLT”. Please then email the necessary documents to accounts (i.e., SDLT5) which will be checked by the accounts assistant before being authorised by a Director.

e. transfer in respect of Estate Agents Fee, which should be requisitioned by creating a “chit” on ALB using the accounts requests system. For the reference, please enter “BAC” and in the payee box please enter the “Payee:Description” for example “Donald Cope:Estate Agents Fees”. Please then email the necessary documents to accounts (i.e., invoice) which will be checked by the accounts assistant before being authorised by a Director.

5. The write-off of any balance in respect of costs or disbursements must be authorised by Timothy Halliday, by referring the file to him with a covering memo detailing why this amount should be written off.
6. Prior to requesting any of the payments listed at point 3 above, the fee earner should ensure that the following checks have been completed and recorded on the file.

CQS CHECK PRIOR TO CONVEYANCING TRANSFERS

It is the fee earner’s responsibility to ensure that the client account ledger has a zero balance within 3 months of completion. Due to the current delays at the Land Registry, this is not always possible but these files should be reviewed each month thereafter.

Review of this policy

This policy will be reviewed, at least annually, by Timothy Halliday (CQS SRO).

September 2025