A sole practitioner who admitted he had not tried to learn accounts rules has been struck off for acting as an escrow agent in diamond purchases.

Tom Jenkins Merralls, a sole practitioner at TJM Law in Bromley, Kent, helped to facilitate deals on behalf of clients wishing to buy diamonds from brokers.

In total he conducted 392 escrow transactions, receiving a minimum of £5.1m into his client account and taking away a minimum of almost £76,000 in fees.

Merralls continued the practice even after the Solicitors Regulation Authority published a warning notice about high-yield investment fraud in September 2013.

A Solicitors Disciplinary Tribunal hearing last year also heard that Merralls used a separate business set up in January 2014, TJM Law Ltd, to facilitate his continued involvement when the SRA became suspicious.

Merralls admitted a number of allegations, including a failure to comply with accounts rules, failing to remedy breaches of rules, and transferring money from the client to office bank account.

But he denied dishonesty and an allegation that he made representations to the SRA that were inaccurate, misleading and untrue as to his continued involvement in the financial investment schemes.

Merralls, who had practised since 2003, explained clients were introduced by a broker, with funds received around the same time from the buyer.

He produced 14 files and client ledgers for scrutiny and assured investigators he carried out due diligence. The solicitor insisted he produced no bill of costs and offered no legal advice.

Merralls claimed not to have seen the SRA’s warning notice and said he did not believe clients were misled because of the small amounts involved and they must have known that ‘no one does nothing for nothing’.

He admitted he had ‘not taken accounts rules to bed’ and did not familiarise himself with the entirety of regulation, suggesting that if he read up on every change a ‘35-hour day would be needed’.

The tribunal said Merralls showed a ‘woeful ignorance’ of accounts rules and stressed that his actions created a shortage on the client account which he did nothing to remedy either promptly or at all. However, in this respect the tribunal found it could not uphold an allegation of dishonesty on account of him not being aware of the rules.

But an allegation of dishonesty was found proven with regard to his continued involvement in the transactions, the use of the separate business and his subsequent explanation to the SRA. This was despite Merralls’ insistence that ‘being dishonest would have been too much work just to make £75,000 in one year’.

The tribunal found the only difference between the old and the new company was the addition of the word ‘Ltd’, with Merralls doing little to show they were separate businesses.

After Barclays froze his account late in 2013, Merralls ‘found a way round the problem’ by using a different client account and continued to operate the scheme for several months.

The tribunal ruled that questions posed by the SRA in January and March 2014 ‘created a new situation to which the respondent acted dishonestly’, and it was not satisfied with the response from the solicitor.

It added: ‘The tribunal felt it was essential to take a cumulative view of allegations and impose a sanction determined by the totality of the misconduct as the allegations showed even without dishonesty a picture of a solicitor who could not safely be let loose upon the public.’

Merralls was struck off and ordered to pay £30,000 in SRA costs.