A law firm owner whose misconduct has cost the entire profession £450,000 has been struck off the roll after admitting dishonesty.
Fiona Jane Smith, admitted in November 2000, allowed her Hartlepool firm MSP Legal Services to run up huge shortfalls in the client account through improper transfers. The Solicitors Disciplinary Tribunal heard that Smith and her co-founder husband Andrew Jones drew down around £245,000 in the space of 16 months before the SRA intervened into the firm in 2023.
The tribunal heard that the SRA’s compensation fund has paid out around £984,000 to settle 23 claims made by former clients. While some of the money recovered from the business was used to cover the costs, the fund – and by extension the legal professions which pays for it – had to make up the shortfall of £450,000.
The SRA investigation found that improper transfers had continued for almost two years and that Smith derived a personal financial benefit from her misconduct.
The tribunal said that ‘significant drawings’ were taken by Smith, causing a substantial client account shortage, adding: ‘Ms Smith had breached the trust placed in her to treat client monies as sacrosanct. The conduct was deliberate, calculated and repeated over a period of time. The misconduct had caused significant harm to the reputation of the profession.’
The tribunal heard that Smith and Jones, who was struck off in 2024 on separate matters, founded the firm in 2007 and worked mainly in conveyancing, wills, trusts and probate, and personal injury. It had a single office with seven members of staff.
Investigators found the shortage in the client account was as much as £639,000 as of February 2023, the majority of which was linked to transfers to the office account. By this stage, the client account held just 4.5% of the money that it should have had.
The tribunal heard that it was unlikely that improper payments to the office account were even used to cover expenditure such as salaries, given the round sums involved.
In mitigation advanced by Smith, she said the firm encountered difficulties in managing its practice during the pandemic. After this, the firm made the mistake of expanding and undertaking bulk property work from several major referring agencies. She also pointed to the inexperience of staff, the retirement of the firm’s bookkeeper and personal difficulties linked to family illness.
Smith accepted she should be struck off and made an agreed outcome with the SRA to also pay £41,000 costs. This outcome was approved by the tribunal.
