It follows the Financial Services Authority (FSA) granting regulatory approval for the service under the Payment Services Regulations.

Announced in September, Barco will enable funds to be held in a ring-fenced account with Barclays. Interest will be returned to clients; if it were not, Barco would change from a payment institution into a bank, with all the heavy regulation that would ensue.

The FSA’s approval paves the way for Barco’s pilot phase ahead of a full roll-out in spring 2013.

Chambers from across the country and a range of practice areas will take part: Atkin Chambers, 2 Bedford Row, 33 Chancery Lane, Erskine Chambers, 39 Essex Street and Outer Temple Chambers (all in London), St Johns Buildings (Manchester), St Johns Chambers (Bristol), 37 Park Square (Leeds) and St Philips (Birmingham).

Michael Todd QC, chairman of the Barco committee and immediate past chairman of the Bar, said: “I am delighted that the FSA has granted approval to Barco. We believe that it will offer an imaginative and unique solution for clients all over the world, making it easier than ever before to work with the Bar, whilst maintaining the Bar’s high quality and cost-effective services.”

Barristers using the scheme will have to incorporate its standard contract in their own terms and conditions; part of this is that all money passing from the client, including legal fees, has to go through the account. The contract has to be sent to Barco and if it is not received within 48 hours of the money being transferred, it will be returned.

When the barrister gives an instruction to pay out money, the client will be notified and, absent their express approval, will have five days to dispute it. One of the goals of the pilot will be to determine a level of funds to be paid out at which express authority will be automatically required.

There will be a percentage charge on the barrister’s fees when they are paid, capped at £250 per transaction. In the medium term the Bar Council hopes to raise a surplus off this fee to make a profit and keep practising fees down.

The pilot is being watched closely by the solicitor side of the legal profession while as reviews of client account are being conducted by both the Solicitors Regulation Authority and Law Society.

Source – Legal Futures – 10 Jan 2013

When he returned to Abbey Forwarding in Woolwich, London, the drinks warehousing business of which he had been a director for five years, he was shocked by what he saw.

”There were about 20 officers from HMRC [Her Majesty’s Revenue and Customs, the tax authorities],” he remembers.

“Some of them were already changing the locks on the doors. Others were going through the company’s documents and computers, packing them up to take them away.”

One officer came up to Mr Hone and told him: “You owe over £5million in taxes. You can’t pay it. The company will be closed down to protect the creditors.”

He introduced a woman whom he said had been appointed liquidator by HMRC to liquidate Abbey Forwarding.

“She told me that I had just been sacked, along with half the other staff,” Mr Hone remembers.

“She would sack the rest in four to six weeks time: for the moment, she needed their help in winding down the company.”*

The woman was Louise Brittain (correct). She now works for Deloitte, charges around £750 an hour, and is described as very tough and experienced. In 2010, she was ranked 17th in Accountancy Age’s list of the industry’s top 100 power players.

She has said that she works out “the pinch point for the fraudster in advance. It could be their family or a house they’re particularly emotionally attached to.”

Having identified it, she goes for it. Mr Hone’s ‘pinch point’ was his business. He and his fellow directors, Richard Mills and brothers Pat and William Owen, whose father had started the company in 1971, didn’t know what to do. “We were looking at financial ruin. Louise Brittain told us our personal bank accounts had all been frozen. We had been ejected from our own company. Thirty-two people had lost their jobs. We didn’t even know where we would get money to live on.”

The action by HMRC had come out the blue. “Our business, systems and accounts had been given a very thorough going-over by a man from HMRC only a month prior to the liquidation order,” Mr Hone recalls.

“We had a letter back from him which gave no hint that we were suspected of fraud. In fact he said our accounts were in order.”

I have seen that letter. It identifies a failure to keep some records according to approved protocols, but also states that “no inaccuracies were identified.”

So what had persuaded HMRC that Abbey Forwarding was “at the centre of a large, multinational, multimillion pound fraud”?

It had a turnover of several million pounds a year on the business of storing and arranging the transport of beer, wines and spirits. The taxes on alcohol are a large part of the retail price, and a great deal of money can be made by avoiding them. But why, having been through Abbey’s books and not identified anything which indicated fraud, did HMRC think the company was engaged in avoiding taxes?

The details of HMRC’s case changed several times: its essence was that its directors had systematically aided and abetted the evasion of the duty on the drink they stored and transported. But it was based on suspicion, assertion and the conviction of its officers that fraud was being perpetrated, rather than hard evidence.

“It was a nightmare, everything that we had built up over years of hard work was destroyed in an instant,” says Mr Hone.

“And the worst thing was, we couldn’t even appeal against HMRC’s order to liquidate Abbey because of its assessment that we owed £5 million.”

When the liquidator takes over a company, and the employees are sacked, the directors all become ex-directors. They have no standing in the company – legally, they no longer have any relationship with it. So, in law, they cannot appeal a judgment affecting the company. The person who can appeal is the liquidator. But the liquidator, although appointed by a judge, is selected by HMRC.

That Catch-22 situation looks very unfair to the ordinary citizen, who can be crushed beneath the juggernaut of a huge state agency, without most of the usual checks and balances to ensure that it is not misusing its power. Mere suspicion by HMRC officials that fraud is occurring can be enough to ruin a business.

HMRC can apply to a judge at an “ex-parte” hearing: one at which the company it wants to liquidate is not represented, and so cannot defend itself.

That is what happened in the case of Abbey Forwarding. The judge admitted he did not have time to go through in detail the evidence that allegedly proved their involvement in “large-scale fraud”.

He was persuaded that “these gentlemen are fraudsters…. there must be a risk, if they are given even a chink of light, of moving assets, removing computers, shedding documents. [But if] a liquidator can go in, properly armed in terms of numbers of people, none of this will be possible.”

The judge agreed to the appointment of a liquidator. But in fact, “these gentlemen” were not fraudsters, and HMRC’s “evidence” turned out to be spurious. The judge who granted the liquidation order could not have known that at the time because he was not given the opportunity to test that evidence. And what happened subsequently shows the dangers of granting liquidation orders on the word of HMRC alone.

Eighteen months later, a different judge was given the opportunity to assess HMRC’s evidence in detail. Ms Brittain, as liquidator, decided to sue the former directors for “malfeasance”: they had failed in their duty to operate the company honestly. Judge Lewison was given the task of assessing whether or not HMRC’s claims about Abbey’s former directors were true.

He found that they were false. Ms Brittain had, for example, alleged that on 301 occasions, HMRC had stopped lorries recorded as having picked up cans of beer from Abbey’s warehouse — but each one of those lorries had, when stopped, been empty.

This showed that Abbey was part of a conspiracy to sell the alcohol without paying the duty owed on it.

But Judge Lewison discovered that, in fact, there were only three occasions when HMRC stoppped empty lorries from Abbey. As the judge pointed out, HMRC and Ms Brittain had exaggerated “by a factor of a hundred”.

How such an allegation came to be made was, as Judge Lewison dryly observed, “unexplained”. But, whatever the explanation, HMRC presented sworn evidence to the court that was untrue. Furthermore, on each of those three occasions, there was an innocent explanation.

Judge Lewison was astonished when one HMRC employee admitted that he had no evidence that Abbey had been involved in fraud, but maintained that he had no proof that it was not involved in criminal activity — which, as the judge pointed out, is not grounds in law for liquidating the company.

In July 2010, he found that there was not a single item that proved that anyone at Abbey had been involved in any conspiracy to defraud HMRC, or indeed any fraud, and he dismissed the action against Mr Hone and the Owen brothers.

It was an enormous vindication for them. In the 18 months since Ms Brittain had taken over their company in order to liquidate it, their lives had been total misery. “I came very close to suicide”, Mr Hone told me.

“It just seemed so hopeless. Every possible way of proving my innocence, of getting my business and my life back, was blocked. The strain on our family was terrible. My son felt he couldn’t go to university: he had to start earning. My mother’s pension was tied up in the business. The legal bills were huge. We had to mortgage everything, and borrow as much money as we could.”

Mr Hone, from Chiselhurst, Kent, who has been married for 26 years, said: “The liquidator took possession of my mobile and called every single person in my address book, including my mother and godson, and asked them how much money I owed them.”

HMRC and their lawyers were ruthless. Two months before Judge Lewison reached his decision, they sent a letter reminding the directors that they were “bound to lose all of their assets and are all likely to go bankrupt”, and that there would be actions against their “family members who have profited unduly from Abbey”.

It warned them that they could only “avoid complete ruination” by admitting their guilt and settling the case.

”We knew we were innocent,” stresses Mr Hone.

“We were never going to give in, not even if they took everything from us.”

And despite Judge Lewison’s ruling, they came very close to doing precisely that.

Not only did HMRC maintain they had been right to close the company, they increased the amount owed to £7million. Ms Brittain, the only individual with legal standing to appeal HMRC’s assessment, refused to appeal it. HMRC’s strategy seemed to be to wear down Mr Hone and his fellow directors by attrition: there were further hearings, costs mounted.

Backed by the state, HMRC had infinite funds. They knew that their opponents had very limited resources.

But they did not give in. They won a series of rulings against the prevaricating tactics of HMRC. On August 4, 2011, five days before their appeal against HMRC’s assessment and tactics was finally to be heard in court, HMRC withdrew their claim that Abbey’s ex-directors owed £7 million in taxes and duties.

In a highly unusual step, Ms Brittain stepped down as liquidator. A new liquidator has been appointed on the recommendation of Mr Hone’s lawyer. He is still awaiting delivery of the relevant documents.

Last week, Mr Hone and the Owen brothers were in court again, suing the liquidator and HMRC for damages for having wrongly frozen their personal bank accounts. After that, they hope to launch a case against HMRC for the loss caused by the liquidation of their company, which amounts to millions of pounds in legal and other fees.

What happened to Abbey Forwarding is not an isolated case. Lawyers who specialise in liquidation proceedings note that HMRC frequently use ex-parte hearings to obtain liquidation orders against companies they suspect of fraud. Of course, many are guilty as charged. But some are not.

There has been disquiet for some years in legal circles at the extent of HMRC’s power. Geraint Jones, QC, a barrister who has been involved in many high-profile tax cases, notes that, as it stands, the law allows HMRC to be “judge, jury and executioner” in its own case. But there are no plans to limit that power; HMRC argues it needs the power in order “to catch the bad guys”.

HMRC will not comment on individual cases, but they insist there are sufficient checks and balances because they have to apply to a judge for a liquidation order.

“We only use ex-parte applications in the most serious cases to deal with the risk of assets derived from fraudulent activity being hidden, or company books and records being destroyed,” said an HMRC spokesman.

“We set out to the Court why we think this approach is the right one. The granting of a provisional liquidation order is then a matter for the court alone.”

To which, Mr Hone responds: “When a judge was able to test HMRC’s evidence properly he found it was all rubbish. If there had been a proper test at the ex-parte hearing the liquidation order would never have been granted in the first place.”

In his view, HMRC’s ability to liquidate companies without robust evaluation of its evidence takes on a sinister quality. He thinks himself lucky not to have been flattened by the power of HMRC; others may not be so fortunate.

Source – The Telegraph – 1 December 2012

Full judgement here:

http://www.crimeline.info/uploads/cases/waya.pdf

Mr Joseph Howman, of Grosvenor Road, Norwich, pleaded guilty to nine offences under the Houses in Multiple Occupation Regulations 2006 and he did not meet the standards required of a landlord in the Licence Conditions (part 2. Housing Act 2004).

The Criminal landlord was ordered to pay £53,635 after being prosecuted successfully by Norwich City Council for putting his tenants at risk, in addition to being fined £5,000 plus £135 victim surcharge and £8,500 costs, Mr Howman was ordered to pay £40,000 under the Proceeds of Crime Act.

Ellen Spencer, private sector housing officer says, “Norwich City Council is committed to making sure private tenants live in safe houses which meet legal standards. In this case, the landlord risked the safety of tenants by cutting corners and refusing to make improvements.

We are pleased that the Court recognized the serious nature of the offences and hope that this will send out a message that rogue landlords will not be tolerated in Norwich.”

The property in Unthank Road was let as 10 bedsits with shared bathrooms and posed a number of hazards to its tenants. The rooms had no heating, the main bathroom had no hot water, the communal bathrooms were dirty, the fire doors were in poor condition with many not working and there were electrical hazards, including hanging wires and defective lighting.

Source: Property 118 – 23 Oct 2012

Jessica Harper, 50, said she was entitled to the cash because she was ‘loyal’ and worked ‘long hours’

Her £60,000 security role at the bank included fighting fraud

The millions of pounds were stolen during the height of the financial crisis when Lloyds received substantial amounts of tax payers money

As the woman entrusted with stopping online fraud at one of Britain’s biggest banks, Jessica Harper naturally put in long hours.

So long, in fact, that the well-spoken 50-year-old – a keen gardener and Rotarian – decided she deserved some extra cash.

Except that rather than wait for a pay rise, Harper turned to fraud herself, embezzling millions of pounds from her employer, taxpayer-backed Lloyds.

She lavished the money on landscaping her garden in South Croydon and renovating a second house in France, as well as giving large sums to her family.

When she was arrested after an internal audit uncovered the fraud, Harper said: ‘I just saw the opportunity and I thought, “Well maybe considering the hours I work and everything else I deserved it”. I know it is stupid, but that’s probably how I felt. If I went to work at another bank I would probably be earning four times my salary.’ 

Yesterday Harper was jailed for five years after stealing almost £2.5million from the Lloyds Banking Group by submitting dozens of false business invoices.

The fraud took place over four years, as the firm was hit by the credit crunch and bailed out by the Government.

Harper, who was the head of fraud and security for digital banking, told the authorities she had sold her home and cashed in a pension and shares worth £300,000 in an attempt to pay back some of the money.

But the Mail can reveal she secretly invested in a sought-after French property – a former police station – and still dreams of retiring there.

The three-storey townhouse is in the idyllic village of La Trimouille, in Poitou-Charentes, south-west France, the Mail discovered.

She has never declared that house to police, and could face fresh charges if it is proved she deliberately concealed it.

Harper spent up to £250,000 on building work and luxury fittings to renovate the once derelict property, which she bought for only £20,000.

The oak-beamed house has three bedrooms, a courtyard and large wine cellar, as well as a £36,000 state-of-the-art kitchen.

Harper was paying French tradesmen for work right up until April, five months after she was arrested for fraud and released on bail.

Her mother Helen Tyrrell, 78, lives in a nearby hamlet, and neighbours said a considerable amount of money had recently been spent on her four-bedroom home, too.

Members of the expat community said Harper made regular trips to visit her mother and oversee the building work – and even planned to buy the jailhouse next door.

One woman said: ‘Everyone used to look forward to Jessica’s arrival as she used to come with suitcases full of items and hold clothes parties. She would have £400 designer jackets that she had worn just once and sell them for £20.

‘She’s told people that the French properties will not be affected by the court case and they’ve just been mothballed for now.’

Southwark Crown Court was told the fraud began in 2007, when Harper set up a payment account to a fake software company, altering an email invoice from a genuine supplier by inserting her own bank account details. Over the next four years Harper, who earned up to £70,000 a year, submitted 93 fake invoices worth £2,463,750.

Prosecutor Anthony Swift said she lavished the cash on her garden and on her brothers, who used it to invest in rental properties.

Harper claimed she gave a further £250,000 to charities and other people, but investigators have not been able to trace the money.

Her brothers, Simeon, Matthew, and Gareth Tyrell, were arrested and questioned over whether they knew the cash was stolen. The prosecutor said her family were ‘shocked, upset and surprised’, as they had believed she was much more highly paid and could afford the gifts.

Harper lived in her semi-detached Edwardian home with Gareth, 46, after separating from her husband John, 50. Another of her brothers, Matthew, runs a networking company working with music stars such as Bob Geldof and Rihanna.

Harper was jailed for five years after admitting fraud and a further four years, to run concurrently, for money laundering.

Source: Linkedin - 1 October 2012

The deal, due to be ratified at the Court of Session next week, has brought an end to a two-year legal battle involving Calum Melville, a former director of Dundee FC, his brother Stuart, and leading marine safety company, Cosalt Offshore.

The fraud defence team comprising, barrister Nigel Edwards of St. Pauls Chambers and Ian Anderson, solicitor for Opus Law are delighted to announce the conclusion of a complex money laundering trial with a not guilty verdict for their client ‘H’.

The Serious Injury Organised Crime Agency accused H of being a ‘high ranking member of an organised criminal group’ and involved in an international money laundering operation. It was alleged that the 19 defendants on trial were responsible for laundering in excess of £170,000,000 in cash out of the jurisdiction to Dubai and China. Businesses in Birmingham, Manchester, Doncaster and Leicester were raided and individuals connected to those businesses arrested. H was arrested in Leeds carrying a bag containing over £340,000 in cash. The cash was forensically examined and found to be contaminated with traces of cannabis and amphetamine. A search of H’s home address revealed further cash sums, anti-surveillance equipment and a quantity of cannabis. Examination of a telephone SIM card uplifted from H’s home address revealed contact with a telephone belonging to a member of the alleged criminal group and surveillance evidence was disclosed showing a meeting between H and that defendant “S”. S subsequently entered a guilty plea.

Extensive and proactive defence work was required in order to surmount the prosecution case, this included the defence team traveling to Dubai to speak to business owners and photograph locations, liaising with businesses in Hong Kong, obtaining expert forensic drug contamination evidence, instructing computer forensics experts, instructing Tim Keeling of Forths Forensic Accountants to examine the defendant’s business records and prepare an expert accounting report, tracing and interviewing in excess of fifteen potential defence witnesses and obtaining witness summonses for prosecution witnesses.

During the trial the expert skills and acumen of barrister Nigel Edwards, a fraud specialist with over fifteen years top level advocacy experience, secured the right result for H and for Opus Law. It is of note that of the 18 defendants on trial so for Money Laundering, only H and one other secured not guilty verdicts.

Source – St Pauls Chambers – 9 August 2012

Warrington-based Stobart Group’s new legal services business, which was launched in May, is performing well beyond expectations according to group legal director Trevor Howarth.

Speaking to reporters in Manchester yesterday (1 August 2012), he said Stobart Barristers, which has been set up to connect businesses and the public direct with barristers, was generating four times its targeted revenue after just three months.

“This has come at a good time for people buying legal services,” he said.

“There has been a reduction in legal aid, with solicitors holding onto more cases, and there is a large appetite from the Bar to deliver the work.

“In terms of revenue [for Stobart Group], we are talking about substantial seven-figure sums in year one.”

Stobart Barristers, which offers access to 1,200 specialists around the UK in any area of law, operates a fixed-fee pricing model, where people can pay as they go during a litigation process.

The new division was formed following Stobart Group’s decision to employ its own barristers without a solicitor in 2008, which has led to savings in its legal fees.

Members of the public, or businesses, have been able to engage directly with barristers since the introduction of Direct Public Access legislation in 2004, but the practice has been slow to take off.

Howarth added: “Barristers don’t have the infrastructure to deliver the service.

“For the first time we offer all of that – paralegals offering the administrative support, for example.

“We have done it ourselves for four years, which has enabled the team to understand how to make this work as a business model.”

The division operates with a staff of 20 on King Street in Manchester and there are plans to grow headcount in the next 12 months.

It also marks a new avenue of growth for the group, which is best known for it logistics capability.

“We became FSA-regulated earlier this year,” added Howarth.

“We also have our own HR team we can put into other people’s businesses to manage a problem for them.

“People recognise what we are doing these days. They saw us move across sectors, such as into Southend Airport, and they can now see the result of that. I think business services are a natural extension of the business.”

Source – Insider News North West – 2 August 2012

Using data from company information from Bureau van Dijk, the Association of Business Recovery Professionals – better known as R3 – estimated that 29% of firms are at risk, higher than the wider business average of 21.8%.

R3 president Lee Manning, a partner at Deloitte, said that while ABSs may make legal services easier to access, they pose “a threat to the legal services market as we know it, particularly for small high street firms”.

He continued: “Traditionally a firm would practice a range of different areas of law. With the introduction of ‘Tesco Law’, new specialist firms will begin to emerge and they will be difficult for the high street to compete with, partly because small practices cannot afford the level of branding and marketing that these new firms will be able to take advantage of. It is also unlikely that they will have the resources or the technology to compete with these ABSs.”

He added that by the end of this month, partners will have to make their second tax payment for the year, and ideally their firm will have maintained a tax reserve fund to settle the partners’ liabilities – “but this is not always the case”.

He said: “This requires very careful planning and steps should be taken to apply for a reduction of payments on account if earnings are expected to reduce over the coming year. This time of year is known to put real cash flow pressure on firms and more often than not we see a spike in banks being asked to find taxation liabilities.

“The Legal services sector is a very crowded market and so firms that are not competitive are unlikely to thrive. Careful planning and management of taxes can help give businesses and edge and make this time of year less daunting.”

Mr Manning urged firms that are worried about their financial future to seek professional restructuring advise “before its too late”.

Source – Legal Futures – 23 July 2012

The Criminal Law Solicitors Association also accused Chancery Lane of seeking to extract money from a sector of the profession that it knows is operating “at the margin of financial viability”.

In a strong response to the society’s consultation on CLAS reaccreditation, the association said the proposals fail to recognise since it was launched in 1999, “there have developed far more relevant and onerous requirements which leave CLAS a redundant scheme”. These include Legal Service Commission demands and the new Quality Assurance Scheme for Advocates.

“We reject the notion that CLAS has any influence on criminal clients’ selection of their lawyer or that CLAS has any credibility with those clients. The Legal Services Commission has only ever required that those undertaking police station advice and duty court representation are appropriately qualified so to do and the measure of qualification they have so far adopted has been to accept the CLAS qualification.

“The commission has publically stated that it has imposed contractual quality requirements in respect of this work and would not therefore look beyond those contractual obligations. We would not expect them to make it a requirement in the 2015 contract”.

The response said the consultation simply supports the Law Society’s efforts to create a uniform reaccreditation structure across all of its accreditation schemes. “It does not consider the need for such a system in the light of the changed requirements since 2001.”

The association also questioned the cost involved “We fail to see why simple self certification of six hours’ CPD should cost £200 + VAT (£240).

“We understand that the current proposal would require up to 5,701 practitioners to reaccredit by 31 December 2012 a cost to the profession of at least £821,040 and possibly as much as £1,368,240 on present Law Society estimates of the number of CLAS members who will required to reaccredit by that date.”

In recent years the Law Society has recognised “that the profession is operating at the margin of financial viability and yet the society proposes to levy an additional fee every five years upon those very lawyers it has supported in the past.”

The response concluded “We would urge the society not to underestimate the profession’s opposition to reaccreditation stemming as it does from an unwarranted increase in overhead costs at a time when criminal law practices have suffered from repeated cuts in income derived from reduced rates and a general reduction in workload across the criminal courts.”

Source – Legal Futures – 18 July 2012