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The Law Society and Solicitors Regulation Authority have been granted leave to intervene in a High Court case on whether professional indemnity insurers should be able to effectively cap cover by aggregating claims against a firm – with a bill of £50m at stake.

The number of claims against the Solicitors Compensation Fund arising out of mortgage fraud have shot up by 140%, it has emerged. However, the time lag in claims reaching the fund means the figures disguise a “marked decrease” in mortgage fraud cases, according to the SRA.

Solicitors who offer financial services and plan to become alternative business structures could be forced out of the market by plans to plug a gap in consumer protection created by the Legal Services Act, the Financial Services Authority has admitted.

The value of compensation claims lodged as a result of dishonesty by solicitors has more than trebled to an astonishing £157 million, Legal Futures can reveal. The rise goes hand in hand with a continuing rise in the number of law firms closed down, which was 90 in the year to June, a rise of 22%.