Where a firm holds a substantial sum of client money for a long period, what must it consider regarding interest?
Answer and explanation
Correct answer: B. Account to the client for a fair sum in lieu of the interest that would have been earned
- Step 1: The Accounts Rules require fairness over interest on client money.
- Step 2: The firm must have a written policy on interest.
Answer
Account to the client for a fair sum in lieu of the interest that would have been earned.
Why not the others: The firm may not keep the interest unfairly; the duty is not conditioned on a request; the SRA receives none.
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