• Application 11655-2017

• Hearing 30 October 2017

• Reasons 15 November 2017

The SDT ordered that the first respondent (admitted 1987) should pay a fine of £16,000; that the second respondent (admitted 1982) should pay a fine of £5,000; and that the third and fourth respondents (admitted respectively 1981 and 1975) should be reprimanded.

The first respondent, while in practice as a partner and director of Thompson & Cooke Limited, and while acting or preparing to act for an offshore client entity (Client C), had caused or allowed funds totalling up to around £1,401,943.05 to be paid into and to pass through the firm’s client account to Client C between approximately May 2012 and October 2013 (the relevant period), in breach of rule 14.5 of the SRA Accounts Rules 2011 and principles 6 and 8 of the SRA Principles 2011.

The first respondent had caused or allowed funds totalling up to around £591,441.26 to be paid into and to pass through the firm’s client account to third parties in breach of rule 14.5 of the rules and principles 6 and 8.

The first respondent had failed to conduct adequate checks and due diligence in relation to the transactions referred to above before authorising and processing them in breach of outcomes 7.2, 7.3 and 7.4 of the Solicitors Code of Conduct 2011 and principles 6 and 8.

The first respondent had failed to conduct adequate checks and due diligence in respect of Client C, particularly as to its owner(s) and/or instructing officer(s) before accepting instructions and during the relevant period, in breach of outcomes 7.2, 7.3 and 7.4 of the code and principles 6 and 8.

The first respondent had involved himself and the firm in various transactions, in breach of outcomes 7.2, 7.3 and 7.4 of the code and principles 3, 6 and 8.

The second respondent, while in practice as a partner and director of the firm, and while appointed as the firm’s compliance officer for legal practice, compliance officer for finance and administration and/or money laundering reporting officer during the relevant period, had failed to take any or adequate steps to prevent or stop the first respondent’s use of the firm’s client account as set out above; failed to cause adequate checks and/or due diligence to be conducted; failed to prevent or stop the first respondent’s misconduct as set out above; and failed to report to the SRA the facts and matters alleged above; in breach of rule 14.5 of the 2011 rules, rules 8.5(c) and 8.5(e) of the SRA Authorisation Rules 2011, principles 6 and 8 and outcomes 7.2, 7.3 and 7.4.

The third and fourth respondents, while in practice as partners and directors of the firm during the relevant period, had failed to take any or any adequate steps to prevent or stop the matters set out above, in breach of rule 14.5 of the rules.

The first respondent was most culpable for the misconduct. The seriousness of his misconduct was not such as to justify removing him from practice. A fine was the appropriate and proportionate sanction.

The second respondent’s misconduct was as a result of his failure to act as he ought to have done. It was too serious for the imposition of no order or a reprimand, but was not so serious as to necessitate his removal from practice.

While the culpability of the third and fourth respondents was low, it was not such that it would be unfair and disproportionate to impose a sanction. In the circumstances a reprimand was appropriate and proportionate.

The respondents were ordered to pay costs of £58,000 on the basis of joint and several liability.