The Solicitors Disciplinary Tribunal has rejected the option of striking off a solicitor over links to suspect investment schemes – despite his agreeing to the penalty.
Robert Sedgwick, who represented himself, had agreed with the Solicitors Regulation Authority to be removed from the roll after admitting to involving himself and his firm in four schemes described as ‘dubious’.
But the tribunal said it had insufficient information to be satisfied it was appropriate and proportionate to strike off the former consultant of south-east firm Buss Murton.
The tribunal said the regulator had not alleged any dishonesty or that the schemes involved any fraud, and that Sedgwick, who had enjoyed a 44-year unblemished career, had these matters hanging over him for more than three years. The agreed outcome, it was noted, not did even set out in detail how the proposed sanction had been arrived at.
Sedgwick and the SRA were asked to re-submit their agreed outcome and came back with a proposal for a 12-month suspension. This sanction was agreed at a one-day hearing earlier this month, along with £18,000 costs.
The tribunal heard that the SRA started its investigation into Sedgwick and his firm in 2016 – two years after an initial complaint had been made by an investor in a scheme. Investments had been paid into the firm which then passed them on to clients purporting to be involved in a carbon emissions eco-projects scheme.
The SRA said it was well established that solicitors should not act as an ‘escrow agent’ for a third party and so should regard any third party requesting this service with extreme suspicion.
Warning notices had been issued by the SRA and Financial Services Authority, the latter specifically related to carbon credit trading where firms were using dubious, high-pressure sales tactics and targeting vulnerable customers.
Sedgwick admitted to provided an account service for four companies and taking part in transfers totalling more than £1m.
In mitigation, Sedgwick said he was not aware of any warning issued by the FSA as to the carbon credit scheme, and he did carry out research on clients which did not uncover anything suggesting they were dishonest or bogus. He sought approval of partners of the firm and asked those assisting in the work to carry out their own searches.