"We are concerned that some of those operating in the regulated legal sector are not fulfilling their obligations to uphold their duties to the courts, clients and third parties, and are not always following all relevant rules and regulations," the Solicitors Regulation Authority (SRA) warned on August 17.
AI hallucinations in legal work and court submissions
The SRA's warning notice highlights that regulators have observed AI-generated "hallucinations" in legal work and in court submissions. Those incidents include solicitors self-reporting and reports from "senior members of the judiciary" of potential breaches of the SRA Code of Conduct. The regulator explicitly links such hallucinations to poor client outcomes, slowed case progression and damage to public trust in the profession.
Confidential client data entered into public AI tools
The notice records cases in which confidential client information was entered into public AI tools, creating data-protection and confidentiality concerns. The SRA cautioned that both free-to-use and paid-for AI systems pose risks, and said client information should only be entered into AI systems where "appropriate contractual, technical and organizational safeguards are in place to protect confidentiality." The regulator reiterated that "client data must always remain within a secure environment."
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See what we buildAccountability, court risk and supervisory liability
The SRA reminded solicitors and regulated individuals that they "remain accountable for AI output." The notice set out concrete legal and regulatory risks: solicitors who mislead the courts risk "serious consequences," and those submitting named case law authorities must ensure those authorities are genuine, relevant and have verifiable citations. The SRA warned that placing AI-hallucinated "false material" before a court could be considered contempt of court, and that those who supervise "junior or non-authorized colleagues" could be held responsible if false citations are presented.
Governance, human oversight and the SRA's outcomes-based approach
The SRA framed its guidance within an outcomes-based regulatory model: it sets standards for the sector but does not prescribe how they must be met. To manage AI risks the regulator listed a requirement that firms put in place "effective governance structures, systems and controls." The notice stressed the need for "appropriate human oversight, informed professional judgement and a proportionate, risk-based approach" to ensure compliance with regulatory and legal obligations.
What this means for solicitors, law firms, and the Law Society
- Solicitors and regulated individuals: You remain directly accountable for the outputs of any AI you use. Verify named authorities, do not present unverified AI-generated material to courts, and apply professional judgement and oversight when using AI.
- Law firms: Firms must adopt effective governance, contractual safeguards and secure technical controls before allowing client data into AI systems. Both free and paid AI tools "pose risks" and require appropriate contractual, technical and organisational protections.
- Law Society of England and Wales: Brett Dixon, vice president, urged responsible use of AI so solicitors can "act in the best interest of their clients," and said that "as the use of AI evolves rapidly, the SRA will need to continue providing the profession with swift and clear guidance so solicitors can use AI with confidence in line with their duties."
The SRA's August 17 warning links observed AI errors and data-handling lapses to tangible professional and legal risks: damaged client outcomes, slower litigation, possible contempt findings and regulatory sanction. The regulator has set clear expectations — accountability, governance, secure data handling and human oversight — while leaving the mechanisms for meeting those expectations to the profession. As Brett Dixon noted, the speed of technological change makes continued, clear guidance from the SRA central to whether solicitors can meet their duties when deploying AI.
