A complaint was made by the Council of the Law Society of Scotland against Christopher James Forrest, formerly solicitor, Falkirk. The Tribunal found the respondent guilty of professional misconduct in respect of his breaches of rules B6.11.1, B6.7.1(c), B6.23, B1.2, B6.7.4, B6.15.1, B6.15.2 and B6.13 of the Law Society of Scotland Practice Rules 2011.
The Tribunal censured the respondent.
The respondent was both cashroom manager and anti-money laundering and risk management partner for his firm. He was therefore responsible for historic client balances and compliance with money laundering procedures. He was given advice in 2012 by the complainers’ Financial Compliance department. By the time of their next inspection in September 2015, he had failed to take effective remedial action. He had also submitted accounts certificates which were inaccurate to the extent that he had not described the problems with historic client balances and compliance with the Money Laundering Regulations.
Solicitors acting as cashroom managers and money laundering and risk management partners must retain responsibility for the books and records, and compliance with anti-money laundering procedures including documenting compliance, respectively. It is essential that the public can have confidence that the profession can be trusted to comply with the accounts rules. The Money Laundering Regulations exist to protect society against criminal acts. Documentation of anti-money laundering procedures allows the solicitor to demonstrate compliance with the rules.
A complaint was made by the Council of the Law Society of Scotland against Robert Fulton Frame, c/o Miller Beckett & Jackson Ltd, Glasgow. The Tribunal found the respondent not guilty of professional misconduct. The Tribunal decided to remit the complaint to the Council in terms of s 53ZA of the Solicitors (Scotland) Act 1980.
The respondent prepared and registered dispositions which contained information as to price which he knew to be false. The purchase price was contrived, and the transfers were gratuitous alienations. The “prices” represented the value of the sale but the seller did not receive the money. The Tribunal considered that a competent and reputable solicitor in these circumstances would have made clear in the dispositions that the consideration was not a price that was being paid but was for certain good and onerous causes.
The respondent remitted part of the sale proceeds of a property to a person without authority from a director of the selling company. He should not have done this. It is essential that solicitors obtain written instructions from the correct person in these circumstances. Failure to do so creates conditions where money laundering, tax evasion and terrorist financing can occur. It also leaves the solicitor open to criticism and liability regarding wrongful disposal of money. However, the Tribunal was of the view that while competent and reputable solicitors in 2019 would not make such a transfer in these circumstances, the issue was not so clear when the transaction was put in its 2010 context. Also, the transfer was to the beneficial owner of the companies. It was agreed that he had effective control of all the companies, which were operated as one enterprise. This payment should not have been made without written authority from the appropriate person, but the Tribunal was not satisfied it represented a serious and reprehensible departure from the standards of competent and reputable solicitors in these circumstances.
In both these instances, the respondent’s conduct represented a departure from the standards of conduct to be expected of competent and reputable solicitors. However, the departure was not serious and reprehensible. The Tribunal considered that the respondent might be guilty of unsatisfactory professional conduct and accordingly remitted the complaint to the Council under s 53ZA.
Graeme Bruce Murray
A complaint was made by the Council of the Law Society of Scotland against Graeme Bruce Murray, Hingston’s Law Ltd, Aberdeen. The Tribunal found the respondent guilty of professional misconduct in respect of his breaches of rules B6.7.4 and B6.4 of the Law Society of Scotland Practice Rules 2011.
The Tribunal censured the respondent.
The respondent was the cashroom manager for his firm from January 2014 and had been a partner since 1993. Cashroom managers must keep proper accounting records such as are necessary to show the true financial position of the practice unit. The respondent failed to do so in respect of his firm’s VAT and PAYE liabilities and loans. Cashroom managers must also rectify breaches of rule B6 promptly. The respondent failed to do so for a significant period (January 2014-September 2015). It is essential that the public can have confidence that the profession can be trusted to comply with the accounts rules. If solicitors are to continue to enjoy the public trust in regard to their financial affairs, they must have careful regard to all the requirements and obligations incumbent on them as contained in the rules. The Tribunal concluded that the respondent’s conduct was sufficient to constitute professional misconduct. It was a serious and reprehensible departure from the standards of conduct to be expected of a competent and reputable solicitor, particularly when the length of the breach was considered.
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