Friday, August 19, 2011

Questions over safety of £160m Legal Aid payments to lawyers as insiders claims some Scots law firms accounts are “dogs breakfasts”

SLAB_logoCan Scots lawyers be trusted with £160m of legal aid public funds when client frauds continue to occur ? LAW FIRMS identified in client frauds should not expect to automatically receive public funds from the ONE HUNDRED & SIXTY MILLION POUND taxpayer funded legal aid budget managed by the Scottish Legal Aid Board (SLAB), until solicitors and their regulators publicly prove they are preventing further fraud by beefing up strict supervision over their internal accounting procedures, according to a senior legal insider who branded Scottish lawyers accounts generally as “a dogs breakfast” and in some cases “lacking any credibility in the business world”.

Last weekend, the Sunday Mail newspaper reported a significant fraud involving up to £150,000 of client funds from Kilmarnock law firm BELL & COMPANY SOLICITORS. It was further reported the law firm called in the Police after the fraud, which had apparently been going on for some months, had been discovered. A paralegal was identified in connection with the fraud and is reported to have been dismissed from her post. There are as yet no reports of any criminal charges being made in the case.

It was later revealed Bell & Co Solicitors regularly conduct legal aid work, receiving, £119,100 of taxpayer funded legal aid for 2009-2010, £82,600 in 2008-2009, £81,800 in 2007-2008, £83,700 in 2006-2007, £81,800 in 2005-2006, £79,700 in 2004-2005, & £91,100 in 2003-2004. All figures are sourced from SLAB’s own legal aid payments figures, available HERE

There is no suggestion whatsoever the fraud at Bell & Co Solicitors extends to legal aid payments, and, according to news reports, the law firm did call in the Police as soon as the fraud was discovered, however as the firm is registered with the Scottish Legal Aid Board and regularly receive payments, SLAB was asked if they were concerned about reports in the press of a law firm which receives legal aid public funds had been identified in a substantial client fraud.

A spokesperson for the Board said : “Any allegation of fraud against a firm’s client account does not mean that legal aid fraud was being committed. The Board has not been notified by the Law Society or the Police of any concerns in respect of legal aid payments to this firm. However, it is our normal practice where there have been any allegations of fraud that we make enquiries to satisfy ourselves that public funds are not at risk.”

The spokesperson continued : “The Board's auditing processes ensure the on-going monitoring of all firms registered to provide legal assistance. We only grant applications that meet statutory tests and on receipt of accounts submitted by solicitors; pay only for work that actually, necessarily and reasonably has been undertaken.”

SLAB was further asked to confirm if any enquiries regarding Bell & Co had been made. Their spokesperson said : “Unfortunately, it would not be appropriate for us to comment further, the statement is the fullest response we can make.”

A senior legal  insider, who prefers not to be named, said SLAB should be more pro-active in taking away legal aid payments from law firms who are identified in frauds of any kind until such time as they prove themselves fit to receive public funds.

He said : “If as happens in some cases already part of the media record, a law firm’s internal structure is such that large scale frauds can go on for a lengthy period of time before being identified, there are obviously problems within the audit procedures of that particular law firm and its supervision of its partners and employees. Clearly this raises questions as to whether it is safe to pay vast amounts of public money to such firms. In my opinion, thought should be given to automatically deregister law firms identified in fraud cases until they publicly prove to the Scottish Legal Aid Board their audit procedures & supervision will prevent such incidents occurring in the future.”

He continued : “Additionally, if a case arises where there is a report of fraud at a law firm, if the firm is registered to provide legal aid there should be a requirement on the Law Society of Scotland and the Police to notify the Scottish Legal Aid Board immediately so the board can make enquiries of the firm  itself and conduct its own audit if required rather than having to read about it in the newspapers first.”

He also backed up claims from others within the profession that solicitors internal audit procedures are a mess.

He said : “Many sets of firm’s accounts I have seen resemble a dogs breakfast and would lack any credibility in the business world. One might say in certain instances, accounts were simply fabricated to get past an audit.“

A former employee of an Edinburgh law firm alleged a general culture of dishonesty in audit procedures, particularly on how accounts for services to clients are prepared.

She said  : “In some cases it is clear there are charges put on clients bills for services which the client neither authorised, requested or required. In one case I am aware of, a client’s bill was three times the amount it should have been. The Law Society took over two years to agree the fee note should be reduced. The law firm pursued the client through the courts for money it claimed was owed to it, yet there was never any doubt the work it alleges it was due payment for, never took place.”

It should be noted in the particular case referred to above, the Sheriff ruled in favour of the law firm’s since-discovered-to-be-fabricated evidence which did not help matters and resulted in a protracted time of threats of repossession & bankruptcy against the client concerned.

The matter was only resolved when the case was given to a journalist to investigate who discovered one of the two counsels opinions had been faked as the Advocate who it was claimed had given the opinion was ill at the time and not working. Upon being shown the evidence, along with an email from the Advocate who denied giving any opinion in the case, the law firm subsequently ceased its demands for any fees, however there are no reports of any action being taken against the law firm and its legal representatives who clearly lied in court to obtain recovery of fees it was not due.


The general perception of Scots law firms failing to keep accurate accounts was coincidentally reflected in sentiments reportedly expressed by the Chief Executive of the Scottish Legal Aid Board (SLAB), Lindsay Montgomery, who was alleged to have said in an allegedly recorded conversation with the Govan Law Centre’s Mike Dailly that solicitors “were useless and unable to count”.

The controversial, unverified remarks were made public by Mr Dailly who claimed the SLAB Chief Executive had leaned on the Law Society of Scotland to silence its Access to Justice Committee, which was chaired by Mr Dailly until he & its members resigned in protest after arguments broke out over the Committee’s published proposals to scrap the Scottish Legal Aid Board and merge it with the scandal ridden, anti-client Scottish Legal Complaints Commission.

The Daily Record newspaper reported on the proposals to merge SLAB with the SLCC and take legal aid under the wing of solicitors directly : “The access to justice committee's plan would transfer the responsibility for administering legal aid to a new body created out of the Scottish Legal Complaints Commission (SLCC), who are currently paid for the solicitors they oversee. Committee chairman Mike Dailly claimed the changes could save £40 million.”

Top Scots QC Paul McBride, who is a Board member of the Scottish Legal Aid Board was reported to have “slammed the proposed changes as "preposterous.” and said further : "SLAB exist to enable access to justice and to make sure legal aid delivers the maximum value for the taxpayer. The board serve a vital role and save the public an enormous amount every year. The idea of putting lawyers in charge of administering money to themselves is preposterous and unworkable. "This is like putting Homer Simpson in charge of a doughnut factory."

While debate still rages on whether the SLAB Chief Executive made the remarks or not, I revealed earlier this week some Scottish lawyers most certainly do have the ability to count their own bank accounts, where : In just one of the cases brought to the attention of Diary of Injustice over the past year, an apparently small but well known law firm in the Scottish Borders was found to have dozens of bank accounts where client funds had been lost on a regular basis and worse still, one of the solicitors in the law firm has, according to information seen by Diary of Injustice, 23 different bank accounts in different banks & different names, some using variations of his own name, others allegedly in his family members name with control signed over to him.


Anonymous said...

If it was in the papers my lawyers had lost £150,000 of someone's money in a fraud I would be round to take out anything I had with them as soon as I could so if they get legal aid the same applies until they prove otherwise

Anonymous said...

"..the Sheriff ruled in favour of the law firm’s since-discovered-to-be-fabricated evidence... the law firm subsequently ceased its demands for any fees, however there are no reports of any action being taken against the law firm and its legal representatives who clearly lied in court to obtain recovery of fees it was not due."

The Faculty of Advocates has a lot to answer for - END SELF REGULATION NOW Mr Salmond.

Anonymous said...

I reckon that liwyer with the 23 bank accounts should be handed over to the taxman!

Anonymous said...

So who was more bent in the case the former employee referred to : the Sheriff or the lawyers?

Disgusting bunch.Proves again once you enter the court everyone there is against you including the so-called independent judiciary.

Anonymous said...

I agree with what you are saying.If law firms do legal aid work they should be beyond reproach because its our money at the end of the day.
Would anyone else throw their money at some company who was all over the papers for losing their clients money?No!
There will be a few more like this we dont know about yet so keep digging and reporting it Peter!

Anonymous said...

I have often thought lawyers fabricate most of their bills to clients so this is not news to me.

People should get wise and stay away from Scottish lawyers.The more we all stay away the more the fraudsters will go bankrupt.

Anonymous said...

Can we really afford to be throwing all this legal aid at lawyers at times like this?

I say take it away and force them to drop their charges for everything otherwise let them go out of business because if there's one thing the world needs less of its lawyers especially some of the nasties you have exposed in your time Peter.

Anonymous said...

The part about the Sheriff kissing ass with the lawyers needs a story on its own.


Anonymous said...

Top Scots QC Paul McBride, who is a Board member of the Scottish Legal Aid Board was reported to have “slammed the proposed changes as "preposterous.” and said further : "SLAB exist to enable access to justice and to make sure legal aid delivers the maximum value for the taxpayer.
Mr McBride, lawyers block access to justice if a client wants lawyers to sue lawyers on the clients behalf. For you lawyers Legal Aid is a gravy train, that is what you really care about not clients.

Anonymous said...

It amazes me how these lawyers expect the public to respect the legal system because the greatest lawbreakers are those who practice law as a profession.

Anonymous said...

LEGAL FRAID ? 14 lawyers, no charges, 177 clients, no penalty : Lord Advocate & Crown Office face questions over refusal to prosecute legal aid frauds.

The Lord Advocate and Crown office are simply incapable of universalism. They would prosecute members of the public for Legal Aid fraud but their own flock, well different rules apply to them. They have no credibility when difference of this nature is evident.

Anonymous said...

A doctor caught speeding at 100mph with his children in the car has escaped a driving ban because of his job.

Mohammed Alhous, 43, of Aberdeen, was stopped on the A9 between Perth and Stirling in April.

At Perth Sheriff Court, Alhous admitted careless driving and was fined £1,200 and given nine penalty points.

Sheriff Robert McCreadie said he would be allowed to keep his driving licence because it would be more difficult for him to do his job if he was banned.

Alhous had been taking his family to Blair Drummond Safari Park in his Mercedes C200 Kompressor Classic.
If he had been a plasterer he would have needed to get the bus to work.

Anonymous said...

Allowing lawyers to award themselves legal aid sounds daft especially after what you revealed about all the legal aid thieving lawyers who got away with it.

Of course only lawyers would propose to wind up SLAB and give themselves the keys to the 160Million!

Anonymous said...

“I have been abused by a series of lawyers, each apparently protected by the Law Society.

I have concluded lawyers have 4 levels of principles in this order of priority:

1) Protect themselves

2) Protect their income

3) Protect colleagues/firm

4) Protect the legal system

The human being at No 5 is the client. Remember Mr Douglas Mill who knew one of John Swinneys constituents had a valid claim against his lawyer and Mr Mill wanted to scupper the claim to protect the lawyer and Law Societies insurers.

Moral of the above facts, trust no lawyer.

Anonymous said...

You touched in something I know first hand to be true as a friend of my wife worked for a solicitor who was always telling her to write as many letters as possible to keep the fees rolling in!

Anonymous said...

So let me get this straight - some bent lawyer can just waltz into a court and get a sheriff to rule in his favour even though there's no evidence or its completely made up?

What kind of a sh#tty scottish justice system is that?


The legal profession needs to look itself in the mirror and ask why it has attracted record number of complaints in recent years, more than any other profession I believe.

The public view of the Law Society of England and Wales, and the SRA, the Law Society of Scotland and SLCC is that they are more like trade bodies rather for the consumer protection or interest.

Clearly, self regulation no longer works or is trusted by the public and therefore a more robust and completely independent regulator is the answer if the profession is serious about restoring the public trust and confidence. Only clients can do this, like buyers on e bay.
The Profession are serious about one thing, their own protection. All those law firms on the TV adverts are regulated by the Solicitors Regulatory Authority. The latter are against naming and shaming. This speaks volumes.

Lawyers are an illegitimate profession, how can they police themselves in any juristiction. How can a justice system take a person who critisises lawyers to court, the courts are run by lawyers so they should be stripped of their power to deal with pressure groups (a fair trial for lawyer critics) I think not.

150,000 to 1 Rough Justice. said...

A website which claims to name and shame under-performing lawyers is facing legal action from the Law Society for alleged defamation.

The site, Solicitors from Hell, was set up by Rick Kordowski after a dispute with a solicitor ended badly.

It invites users to post detailed testimonials about poor service, directly naming the lawyers involved.

But the Law Society says there is no system for substantiating the negative comments on the site.

Defamation claims have already been brought against Mr Kordowski, a graphics designer, by individual law firms. The latest was in the High Court last week.

But now the Law Society is planning to pursue two cases against Mr Kordowski, one on behalf of solicitors already on the site, and another on behalf of the profession.

Speaking on BBC Radio 4's You and Yours programme, Law Society Chief Executive Desmond Hudson described the site as "littered with untruths and abusive comments", and accused it of not giving lawyers a right of reply.

But John Flood, professor of Law and Sociology from Westminster University, defended the Solicitors from Hell website, saying it filled a gap in the market.

"I don't think the site would be there if there wasn't a considerable amount of dissatisfaction with the way legal services were being delivered in this country," he said.
The Law Society want the site shut, when many of the postings are fact, this is regulation and it is working hence the Law Societies class action against one man, 150,000 lawyers against one man, no doubt they believe this is justice. Victory to Solicitors From Hell, and freedom of expression.

Anonymous said...

While our jails keep filling with young men and women whose property offences amount to nothing like the extent of something such as this, when our schools and hospitals on their impoverished budgets have to account for every single penny spent in their desperate attempt to hold together the fabric of a decent society, those in high offices of government act with impunity.

Scott Veitch, Reader in Law at the University of Glasgow.

Yes Scott I agree there is a line where many of the powerful are above the laws they impose on everyone else.

MP's expenses, oh they need to cut the deficit but they would still be lining their bank balances if the truth had not come out. Or Mr Douglas Mill who lied to the justice committee and is still working as a lawyer, John O'Donnell, and MacAskill thinks we owe a great debt to the legal profession a network of criminals who are dealt with by their own and get a slap on the wrist for monsterous crimes. The Law Society and SLCC are human rights abusers.

Anonymous said...

Well at least Bells did call in the Police although that leaves more questions than answers.Did they call the Police before or after consulting with the Law Society?or before or after they knew the press were on their tail?

Lets hear some answers to these questions!

Anonymous said...

How the hell do lawyers get away with arguing there should be more legal aid in a recession?
Get real leeches you are only doing yourselves a favour not your clients!

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