THE ruling body for solicitors has been hit with almost €50m worth of claims since the onset of the crisis by clients who say they are victims of fraud.
The Compensation Fund of The Law Society, which pays out to victims of fraudulent solicitors, has received €48m worth of claims in the last five years.
The society, which has come under fire in the wake of the jailing of former solicitor Thomas Byrne, has paid out €17.7m to victims of fraudulent solicitors in the same period.
Justice Minister Alan Shatter has defended a U-turn on plans to strip solicitors of their right to self-regulate, saying taxpayers should not have to shoulder the burden of solicitor fraud.
"It would not be in the public interest to be left exposed to the potential liabilities of tens of millions of euro that would have to be paid indefinitely out of the public purse," said Mr Shatter.
Mr Shatter, who is finalising amendments to the long-awaited Legal Services Regulation Bill, said that against the background of €48m worth of claims, it would be "prohibitive" for the State to assume "the enormous and ongoing liabilities that arise directly or indirectly from fraudulent solicitors or the operation of the Solicitors' Compensation Fund".
Mr Shatter added that the new Legal Services Regulatory Authority will deal with all disciplinary issues, but will also be able to initiate the investigation of fraud and dishonesty on its own authority.
The society, which is spending some €10m a year to regulate solicitors' practices, has reported 10 solicitors in the last year to the garda fraud bureau.
A further 12 reports have been made under anti-money laundering laws by the Society.
Interviewed in the 'Law Society Gazette', newly elected society president John P Shaw said that the solicitors' profession was "facing a largely hostile media that feels it is not good to promote solicitors".
Mr Shaw said that he was confident that the actual handling of complaints would not improve if moved to another authority.
Now it has emerged that the solicitors' profession has secured a major concession from Mr Shatter who said that he has been persuaded by the view that the regulation of solicitors' accounts -- including possible acts of fraud and dishonesty -- should continue to be done by the joint representative and ruling body.
The move could save up to 60 jobs in the society's regulation department.
The society has robustly defended its handling of a series of high-profile matters before the courts, including its handling of the Thomas Byrne case.
In submissions to the Government, the Law Society dismissed what it claims is "the myth of regulatory failure" and said cases such as the Byrne case proved the efficacy of its regulatory system.