Your CQS Policies Are Not Finished: Five September Updates Firms Should Review

A CQS policy can be accurate on the day it is approved and still become unreliable as regulation, lender instructions and Land Registry practice move on.

That is the central lesson from five policy developments identified in the September 2026 update. They concern client account interest, the responsible use of artificial intelligence, identity evidence for parties represented by excepted persons, monitoring lender instructions and the execution of deeds.

The subjects appear different, but they expose the same governance problem. A policy library is not a finished compliance project. It is a working control system that must be reviewed, amended, communicated and evidenced.

Earlier guidance on operational policies for CQS conveyancing made the point that required changes must reach both the firm’s documents and the people expected to apply them. The latest developments show why that process cannot be limited to the annual accreditation cycle.

1. Client account interest requires a fair and transparent method

The first development concerns the interest earned on client money. A policy should do more than repeat the wording of the SRA Accounts Rules. It should explain how the firm decides what constitutes a fair sum of interest, how that calculation is applied consistently and how the position is explained to the client.

A workable procedure may need to address the amount held, the period for which it is held, the relevant reference rate, pooled and designated accounts, reasonable administrative cost and any de minimis threshold. Where the firm reaches an alternative arrangement with a client, the basis and the client’s informed agreement should be recorded.

This belongs naturally within the firm’s CQS Client Care Policy. It also adds a specific financial transparency issue to the broader questions considered in the earlier article, What is in a CQS Client Care Policy?

The practical question for the policy owner is simple: could the firm explain and reproduce its interest calculation for any completed matter without having to invent the methodology after the event?

2. AI output does not displace professional responsibility

The second development follows renewed regulatory attention on the use of artificial intelligence. AI can assist with document review, drafting and the identification of possible issues. It can also produce inaccurate material, fabricated authorities or confident conclusions that are not supported by the transaction documents.

A sound policy should therefore define permitted use, prohibited use, confidentiality safeguards, supervision and the level of human verification required before output is relied upon. The individual lawyer and the firm remain responsible for the advice and work delivered to the client. That responsibility cannot be transferred to a software supplier or hidden behind an automated result.

The relevant operational home is the CQS Information Management and Security Policy, read alongside any separate AI and technology policy. There is also a useful parallel with the earlier discussion of explainability and professional accountability. A firm must be able to identify what the system did, what information it considered, who checked the result and why the final professional decision was made.

This is not an argument against technology. It is an argument for controlled use. Speed is valuable only where the lawyer can verify the output and place it in the wider context of the client’s instructions, the title, the lender’s requirements and future marketability.

3. An excepted representative does not remove the underlying identity question

The third update concerns HM Land Registry identity evidence. Where an excepted party acts for another person or company, the exception applying to the representative should not be treated as removing the need to consider the identity of the underlying party.

The file should clearly identify the representative and the person or entity represented, establish authority and capacity, complete the relevant identity information accurately and retain the evidence supporting both the identity and any exception relied upon. Discrepancies should be resolved before the application is submitted.

This is a property fraud control as much as a registration formality. The procedure should therefore be reflected in the CQS Mortgage and Property Fraud Prevention Policy.

The risk is easy to underestimate because an application can look procedurally routine. Yet an inaccurate identity panel or an unexplained gap between the named party and the person behind the transaction may produce a requisition, delay registration or expose a deeper fraud concern.

4. Lender instructions need a second check before the Certificate of Title

The introduction of change alerts on the new UK Finance Mortgage Lenders’ Handbook platform is useful, but an alert should be treated as an aid rather than proof that nothing has changed.

A defensible process includes an initial check of the relevant Part 1 and Part 2 instructions when the mortgage offer or instructions arrive, followed by a fresh check before the Certificate of Title is submitted. The file should preserve dated evidence of both checks. If a new or amended requirement affects the transaction, the issue should be assessed and reported to the lender, with written authority obtained where necessary before requesting funds or completing.

The procedure belongs in the firm’s CQS Dealing with Lenders Policy. Firms may also wish to revisit the earlier guidance on drafting a CQS Dealing with Lenders Policy and the article explaining why the UK Finance Mortgage Lenders’ Handbook moved to a new platform.

The important control is not simply access to current instructions. It is a reliable method for proving which instructions were checked, when they were checked and what the fee earner did with the result.

5. Execution defects should be found before an application reaches HM Land Registry

The fifth development concerns execution of deeds and the prevention of registration requisitions. A final execution review should confirm that the correct form and execution clause have been used, the parties have signed in the proper capacity, witnesses were physically present where required, witness details are complete and the document has been properly delivered and dated.

Corporate and other entity execution requires particular care. Authority, capacity and supporting evidence should be checked rather than inferred. Alterations, incomplete panels, illegible witness details and inconsistencies between names in the deed and title should be resolved before submission.

When resolving short lease issues post-completion, ensure Form AP1 and lender consent are properly prepared using our Land Registry lease extension registration checklist.

These controls fit within the CQS Risk Management Policy. The earlier CQS Risk Management Policy guidance explains the wider need for defined responsibility and communication of risk information. The more recent article on post completion work and lender panel risk also shows why registration should not be treated as an administrative afterthought.

Five changes, one continuing duty

The common thread is policy maintenance. A firm may have bought or drafted an excellent policy, but the document only protects the practice if it continues to reflect current requirements and actual working methods.

A useful review process should record:

• the external development that triggered the review;
• the policy and procedure affected;
• the wording adopted or adapted by the firm;
• the person who approved the change;
• the effective date;
• the staff who were notified or trained; and
• the evidence used to test whether the new control is being followed.

This turns a policy amendment into an auditable compliance action. It also helps the SRO and policy owners demonstrate that review is continuous rather than reactive.

This article summarises general compliance themes and is not a substitute for the full update, current regulatory guidance or advice on a firm’s particular circumstances. Each firm should decide whether and how suggested wording is adopted, allocate responsibility for implementation and retain evidence of its review.