Mixed views on Maxwell report

Senior City lawyers gave a mixed reaction this week to Department of Trade and Industry (DTI) findings regarding several City institutions including two law firms in its report into the Maxwell scandal.While mainly directing its ire at the Maxwell brothers and City banks, the report found that Clifford Chance had failed fully to investigate the manner in which Mirror Group Newspapers was run when it acted for the company in its 1991 flotation, chiefly because the firm had not read board minutes.

Clifford Chance told the DTI that it was not the firms practice at the time to read board minutes, but the DTI said it should have done.

It found the firms verification work defective in failing to identify that the description of the board gave an incorrect impression.

Fellow magic circle practice Linklaters was also mentioned for its failure to identify this in reviewing Clifford Chances work, but its responsibility was very much more limited, the report said.

Clifford Chance would not comment on the report.A Linklaters statement drew attention to the fact that it did not act for Robert Maxwell, and said the firm believed that it had taken all the appropriate action.Speaking to the Gazette, six corporate lawyers in top ten City firms gave a mixed reaction to the DTIs view of Clifford Chances position.Asked whether they read board minutes on flotations now, and whether they did ten years ago, five answered that they do now and four said they would have done then.One magic circle partner said his firm had been approached by Robert Maxwell several times from the 1980s onwards, but had rejected his work because of recommendations in a previous DTI report that he was unfit to act as a director of public company.At any one time, there are a number of people like Maxwell who one refuses to work for, he added.Jeremy Fleming