Potential conflicts presented by law firm secondments to major clients are set to come under scrutiny from the Solicitors Regulatory Authority (SRA), following the publication of a report into the Royal Bank of Scotland's controversial Global Restructuring Group (GRG).

The report – carried out by Promontory Financial Group on behalf of the Financial Conduct Authority, and published in full under parliamentary privilege last week – strongly criticises RBS for GRG's treatment of small business customers.

It also details how some lawyers seconded to the RBS unit took advantage of their position to pass confidential information back to their firms.

Promontory's report reveals 14 cases where the use of seconded staff, including at least one lawyer, from professional services firms "clearly led to a potential conflict of interest". This included secondees giving their employers details of bids from rivals to help them secure work from the bank. Some also tried to favour their employer in relation to when work was allocated, while in other cases secondees sent emails to GRG customers using their permanent employer's email.

While the criticism contained within the report was initially leaked to the press in late 2017, the SRA has only noted the severity of the claims more recently. An SRA spokesperson told Legal Week: "On the face of it, this seems to be something we need to be interested in and we will be seeking further information."

According to some, not all UK firms are taking issues around potential client conflicts seriously enough, with some partners at US firms arguing that UK firms are less stringent about conflict checks than their US rivals.

One former UK law firm partner, now at a US firm, comments: "I think UK firms are far less rigorous and leave a greater degree of commercial discretion. I am aware of secondees who have not respected the confidentiality process and have gone back to their law firm and shared confidential information about working there.

"My former UK firm would send someone on secondment and they would still have their work pass, and could come into the office and have regular contact with partners and use their work email account – the secondee would remain very much part of their firm."

In contrast, he said that at his current US firm, seconded lawyers would see their email accounts "paused" and would no longer have a security pass to the firm's building. "They are treated as a person working for a client rather than the firm. New York Bar rules on conflicts are much more stringent."

The report has raised questions about who should enforce issues like this around client conflicts.

One RBS lawyer says: "It raises questions around who should be setting the bar, and at what level. You have the financial regulator, the SRA and then the banks, and the law firm's own rules."

Richard Moorhead, professor of law and professional ethics at UCL, believes firms need to be much tougher in policing secondments. He says: "What I have learned about secondments is that some law firms seem to be getting too close to their clients. Secondments can be useful, but they also risk diluting lawyers' independence.

"I think law firms should be more robust and the SRA should go back and think again about taking these risks more seriously. We have seen banks behaving irresponsibly, and part of that is helped by lawyers getting too close to them."

Speaking about his own experience of sending lawyers on secondment in the UK, another partner at a US firm says: "I will stay in touch with secondees, but there's an understanding that there is a procedure in place and you have got to treat them like the client at that point. Usually we would issue a secondment agreement – we have a standard one and the bank would be able to comment on it."

He adds:  "If you are on secondment in the legal team of an institution, you have got to have that sense of what is appropriate information to share or not."

Other partners though argue that there is a distinction between secondees strengthening the relationship between their firm and the client, and passing on confidential information.

As one banking partner at a UK firm says: "There is a difference between making sure your law firm is included in a tender – there's an unspoken and sometimes spoken understanding that a secondment will benefit the firm in this sense – and passing on confidential information. That falls into a different category.

"Usually it is about building a relationship. There's a carrot held out by the bank that if we provide a secondee, then the bank will give us more work."