I read your opinion ‘A Level Playing Field’ (see [2008] Gazette, 15 January, 10) about proposed reforms of the Scottish legal profession with great concern. I recognise that the implementation of the Legal Services Act is well under way in England and Wales. However, the tsunami that has shaken the world’s financial systems should give the government, the Law Society and the Office of Fair Trading cause to reconsider their dogmatic belief in the destruction of the safety nets created by the separation of professional powers.

The key element behind the instability of the financial system was the destruction of honeycombed safeguards set up under President Roosevelt and imitated around the world. Since about 1970 those controls were eroded, bit by bit, allowing financial institutions to compete with each other ferociously. This resulted in cheaper prices, falling returns and, over time, excessive risk-taking.

Encouraging law and accountancy firms to merge is another example of this same dogma. Of particular concern are conflicts of interest around audit work. Audits of publicly quoted companies need to be undertaken by independent-minded professionals. They must recognise that their sole duty is to verify accounts, and give a true and fair view of the companies’ financial position. Many audit firms seem to have fallen short of that recently, given the way in which so many toxic assets were allowed to poison what were apparently strong balance sheets.

One suspects that the pressure on audit partners in already huge accountancy firms is great. So many fees from other work – tax, consultancy and legal work – ride on the connection with the audit.

That pressure will be even greater when accountancy/legal conglomerates are not only doing audit work but also providing a full range of legal services for one corporate client.

This is a conflict of interest at the heart of the financial system. It is shocking that we, as lawyers, seem to be willing to allow such naked conflicts to flourish because of a short-term desire – on the part of some – to maximise profits through the creation of accountancy/legal mega-firms.

Stephen Lloyd, Senior partner, Bates Wells & Braithwaite, London