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Third-Party Managed Accounts (TPMA) for Law Firms

An FCA-regulated alternative to the traditional law firm client account - with less admin, stronger fraud protection, and no annual accountant report.

FCA regulated £18bn+ securely processed Trusted by 40+ Top 100 UK law firms
Speak to a payments expert Get the TPMA Guide
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What is a Third-Party Managed Account?

What is a Third-Party Managed Account (TPMA)?

A Third-Party Managed Account - or TPMA - is a regulated payment account provided by an FCA-authorised firm, used to receive, hold, and release client funds on behalf of a law firm.

Instead of client money sitting in the law firm's own client account, it's held by the TPMA provider in ring-fenced, safeguarded accounts. The law firm keeps full control over when and how funds are released. The TPMA provider handles the regulated infrastructure, compliance reporting, and fraud checks.

TPMAs are formally recognised by the SRA under Rule 11.1 of the SRA Accounts Rules 2019 as an approved alternative to the traditional law firm client account. They're not a workaround - they're a route the regulator built into the rules.

Questions about CASS 15 and Shieldpay

If you're a law firm with questions about our CASS 15 compliance position, or want to understand how our safeguarding arrangements work in practice, contact us at compliance@shieldpay.com. 

Further reading


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Why firms are making the switch

Why law firms are moving away from client accounts

Law firms are not in the business of managing money - but for most of legal history, holding client funds has been unavoidable. The SRA Accounts Rules try to manage the risks through reconciliation requirements, prompt allocation rules, and the annual accountant's report. That framework mostly works, but it creates real overhead.

The risks of holding client money directly, include:

  1. Fraud exposure - bank detail interception and APP fraud hit law firms hard, particularly in conveyancing and high-value settlements
  2. Reconciliation errors - even well-run firms can fall foul of the Accounts Rules through administrative mistakes, not bad intent
  3. Insolvency risk - if a firm runs into financial difficulties, client money held in its account can be at risk
  4. Regulatory burden - the annual accountant's report alone costs most firms £3,000-£10,000+ per year, on top of the internal time spent preparing for it

A TPMA removes these risks at source. If the firm never holds the money, the firm can't lose it, misappropriate it, or be exposed when something goes wrong elsewhere in the business.

The collapse of Axiom Ince - where the SRA found a £64m shortfall in client accounts in October 2023 - is the clearest recent reminder of what happens when client money protection fails. It couldn't have happened if the funds had been held by a regulated third party instead.

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GUIDE | A Practical approach to smarter legal payments with the modern TPMA

TPMA Guide - grey

 

Get the TPMA Guide

Why Shieldpay

Why Shieldpay

Our TPMA capability provides all the benefits of a traditional client account but with greater efficiency, automation, and security — allowing law firms to focus on legal work, not payment admin.

Control

You decide when funds move. Custom approval workflows, matter-level mirror ledgers, and full audit trails keep authority with your team - not with us.

Clarity

Every transaction is visible in real time. Pull reports and statements by matter, by date, or by client - without chasing your accounts team.

Compliance

FCA-regulated infrastructure, SRA-compliant model, and no annual accountant report for Shieldpay-held funds. We carry the regulatory weight so you don't have to.

Confidence

Ring-fenced accounts with Citi and ClearBank, Confirmation of Payee checks on every payment, and ISO 27001-certified security. Your clients' money is protected - and your clients know it.

Comparison table

Traditional client account vs Shieldpay Payment Account

Both traditional client accounts and Shieldpay Payment Account safeguard client funds and maintain solicitor control. The difference lies in how we help you manage operational efficiency, reduce risk, and maintain compliance — with significantly less administrative burden.

What Matters Most Traditional Client Account Shieldpay Payment Account
Safeguarding & Control Full safeguarding, solicitor control Full safeguarding, solicitor control - FCA-regulated Enhanced
Annual Accountant Report Required (£3k-£10k+ per year) Not required for Shieldpay-held funds Less admin
Fraud Protection Standard bank security Confirmation of Payee checks, automated verification, real-time monitoring Enhanced
Reconciliation Manual, time-consuming Automated and real-time - saves up to 70% of accounts team time Faster
Setup Time Weeks to months 3-5 business days Faster
Visibility & Reporting Limited real-time access 24/7 portal, custom reporting, complete audit trails Real time

Both models protect client funds and keep solicitors in control. The difference is in operational burden, fraud protection, and cost.

Wondering whether Shieldpay is safe to use? Here's everything you need to know.

Use cases

Built for real legal work

TPMAs aren't one-size-fits-all - but the underlying need is consistent across legal practice: a secure, compliant way to hold and move client money without it becoming a burden on your team. Here's how Shieldpay works across the areas where it matters most.

Conveyancing

Confirmation of Payee checks on every payment, completion funds held until you authorise release, and a full audit trail for every transaction. A practical answer to conveyancing fraud.

Corporate

Manage deposits, completion accounts, and deal proceeds with real-time visibility and automated reconciliation. Set up in days, not weeks.

Litigation

Hold settlement funds securely, distribute to multiple claimants with automated verification, and maintain a clear audit trail from receipt to disbursement.

Private client

Manage trusts and estates with transparent reporting, matter-level ledgers, and flexible hybrid arrangements where needed.

Trusted by leading UK law firms

More than 40 of the UK's top 100 law firms use Shieldpay to manage client money - from high-value M&A completions to large-scale litigation settlements. Here's why...

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ISO 27001

certified security

 

£18bn+

securely processed

 

Top 100

UK law firm adoption

 

How it works

Every transaction on Shieldpay follows the same three steps - verify the parties, hold the funds securely, disburse when you're ready. Here's how that works in practice.

Verify payments securely

 

Verify payments securely

Parties are onboarded quickly with integrated KYC, AML screening, and Confirmation of Payee checks. The right permissions are set for each member of your team from day one.

Hold funds safely

 

Hold funds safely

Client funds are held in ring-fenced accounts with Citi and ClearBank, safeguarded under FCA regulations and the Payment Services Regulations 2017. Completely separate from Shieldpay's own funds.

Disburse with confidence

 

Disburse with confidence

You authorise the release. Shieldpay executes via Faster Payments, CHAPS, SEPA, or SWIFT - with automated reconciliation and a complete audit trail attached to every payment.

Compliance and security

Shieldpay is FCA-authorised, ISO 27001 certified, and registered with HMRC. Your clients' funds are held in ring-fenced accounts with tier-1 banking partners - protected under the Payment Services Regulations 2017 and completely separate from Shieldpay's own funds.

    • Safeguarding that aligns with SRA rules

    • Ring fenced client funds

    • ISO 27001 certified

    • Permissions that reduce internal risk

    • Mirror ledger per matter and a clear audit trail

    • Fast and secure settlement of funds

    • No annual accountant reports required

    • AES-256 and TLS 1.2+ encryption

    • Regular penetration testing by CREST-accredited firms

Want to go deeper on how we protect your clients' funds? Our Trust and Security Guide covers safeguarding, fraud controls, insurance, and cyber security - including our 2025 safeguarding audit score of 99.88%.

<p>Download the Trust &amp; Security Guide <strong>→</strong></p>

Compliance & Security Credentials | Shieldpay

FAQ

Common questions about TPMAs

A Third-Party Managed Account (TPMA) is a regulated payment account held by an FCA-authorised firm on behalf of a law firm, used to receive, hold, and disburse client funds. The law firm's clients pay into the TPMA rather than the firm's own client account. The TPMA provider - not the firm - holds the funds and manages the regulatory compliance, while the law firm retains full control over when and how funds are released.

TPMAs are formally recognised by the Solicitors Regulation Authority under Rule 11.1 of the SRA Accounts Rules 2019 as an approved alternative to the traditional law firm client account.
No. A TPMA and a traditional law firm client account both protect client funds and keep the solicitor in control of when money moves - but the key difference is who holds the money.

In a traditional client account, the law firm holds client funds directly in a bank account in its own name. In a TPMA, the funds are held by an FCA-regulated third party (like Shieldpay) in ring-fenced, safeguarded accounts. This shifts the regulatory burden of fund safeguarding to the TPMA provider and removes the requirement for an annual accountant's report on those funds.
Yes. The SRA formally recognised TPMAs as a compliant alternative to the law firm client account in November 2019, under Rule 11.1 of the SRA Accounts Rules 2019. Law firms using a TPMA remain subject to SRA oversight and retain responsibility for their own AML compliance - but the regulatory burden for fund safeguarding shifts to the FCA-authorised TPMA provider.

Shieldpay is authorised by the Financial Conduct Authority as a Payment Institution (FCA firm reference number 770210) and complies with FCA safeguarding requirements under the Payment Services Regulations 2017.
No annual accountant's report is required for funds held in a TPMA, per SRA Accounts Rules guidance. This is one of the most significant practical benefits for law firms - the annual accountant's report typically costs £3,000-£10,000+ in external fees, plus the internal time required to prepare for it. Funds held by the TPMA provider fall outside the scope of the report requirement.

Law firms that use a TPMA for some matters but still hold client money directly for others will still need an accountant's report in relation to those directly held funds.
The law firm retains responsibility for its own AML compliance when using a TPMA. Shieldpay provides the verification infrastructure - including automated KYC checks, AML screening, sanctions checks, and Confirmation of Payee bank account validation - to support the firm's compliance obligations. But AML responsibility remains with the law firm, not the TPMA provider.
A TPMA and an escrow account are related but not the same. An escrow account holds funds for a specific transaction until agreed conditions are met - most commonly used in M&A completions and property transactions. A TPMA is a broader arrangement that can hold client funds across multiple matters and multiple practice areas, operating as an alternative to the firm's client account as a whole.

Shieldpay offers both - a TPMA for ongoing client money management across a firm's practice, and dedicated escrow accounts for specific high-value transactions.
Most law firms are set up and running on Shieldpay's Payment Account within 3-5 business days. This includes onboarding, KYC checks for the firm and key users, and configuration of approval workflows and permissions.
TPMAs are used by law firms across all practice areas - conveyancing, litigation, M&A, private client, and general commercial practice. Any firm that holds client money can benefit from a TPMA arrangement.

Shieldpay works with more than 40 of the UK's top 100 law firms, as well as mid-sized and specialist firms across conveyancing, group litigation, and corporate transactions.
You can use a TPMA for specific matters, practice areas, or transaction types without switching your entire firm. Many Shieldpay clients use a hybrid approach - running a TPMA for high-value or high-risk matters (such as large M&A deals or group litigation settlements) while maintaining a traditional client account for lower-risk work. The SRA's rules allow for this flexibility.
These are entirely different products. A Separately Managed Account (SMA) is an investment management product, used in the US and UK wealth management industry to manage investment portfolios on behalf of individual clients. It has no connection to legal payments or law firm client money.

A Third-Party Managed Account (TPMA) in the UK legal context is a regulated payment account used by law firms as an alternative to holding client money directly, authorised under the SRA Accounts Rules 2019 and provided by FCA-regulated payment institutions. The two products share a similar name but serve completely different purposes.

Spend less time on client account admin. More time on clients. Whether you're exploring a TPMA for the first time, looking to reduce compliance overhead, or managing a specific high-value transaction - we're happy to talk through how Shieldpay works for your firm.

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