Solicitors warned as commission calls for single fraud law

Lawyers should be on guard against the potential frauds of their clients now more than ever, the solicitor head of the Fraud Advisory Panel told the Gazette last week.

Speaking at the launch of the panel's annual report, George Staple QC, former director general of the Serious Fraud Office who is now a consultant with global giant Clifford Chance, said: 'Lawyers tend to be at a greater distance form fraud than some other professionals - but they should be aware that with the market in a febrile state wrongdoing can occur.'

He said: 'Solicitors should be aware that accounts can be misstated.

They should address companies' managements and make sure that they are getting the full picture when acting on their clients' behalf.'

He added: 'We are at the point in the economic cycle where frauds are uncovered.'

Mr Staple praised the findings of the Law Commission which last week recommended a new offence of fraud.

It said current fraud offences should be scrapped, making way for a single comprehensive definition of criminal fraud.

This would be easier for juries to understand, a more effective tool for prosecution, and fairer for defendants.

It would also be better able to cover new types of fraud that usually escape prosecution under the current regime.

Claire Lipworth, a partner with London fraud firm Peters & Peters, said the new offence could serve the interests of prosecutors and defendants alike.

But she said there was a contradiction between recent government proposals - made in the White Paper 'Justice for All' - that jury trials should be scrapped in fraud cases, and the Law Commission's findings that the offence of fraud should be simplified to help jurors.

Meanwhile the Proceeds of Crime Act - which extends solicitors obligations to report clients they suspect of fraud - received Royal Assent late last month.

It will be brought into effect in two phases: later this year, and at the beginning of next year.

Jeremy Fleming