A solicitor convicted of defrauding clients to prop up his ailing firm has been struck off the roll. Stephen John Ellis, 44, was jailed for five years at Carlisle Crown Court last December after admitting to six counts of fraud, three counts of dishonestly making false representation to make gain, one count of false accounting and one count of making false representation to creditors.

In total he defrauded clients of £218,000.

He had been senior partner at Kendal firm Temple Heelis Commercial LLP (trading as TH Commercial LLP), which was shut down by the Solicitors Regulation Authority in 2014. The firm had no connection with Temple Heelis LLP, which is a separate recognised body practising in Kendal and Windermere, and was not party to the proceedings. 

A hearing at the Solicitors Disciplinary Tribunal last month heard Ellis, who had a previously unblemished career since being admitted in 1999, ran a business which was underfunded and operating beyond its means.

In his sentencing remarks, His Honour Judge Peter Hughes QC said Ellis resorted to a variety of fraudulent means to keep the firm afloat and fund his comfortable lifestyle.

He misused client funds to support the running costs of the office in the hope that business would improve and the funds would be replenished.

But the fraud escalated, and Ellis then created wholly fictitious invoices for work done, which bore no resemblance to reality.

‘[These] were designed grossly to inflate your ageing debt to support applications for loans,’ said the judge,

‘What makes it even worse, sadly, is that you even went so far as to take steps to try to recover unpaid fictitious bills.’

Ellis then threatened clients with legal proceedings and actually instituted proceedings against them in the county court. In total he produced invoices showing he had personally done work valued at £283,000 and was owed this amount: this figure formed part of an aged debtor report submitted for entering into a Company Voluntary Arrangement.

The tribunal also heard Ellis obtained a short-term loan of £70,000 on the strength of a solicitor’s undertaking, dishonestly representing that the money was to be used to pay for renovations to his house.

Ellis was declared bankrupt in February 2014 and his practising certificate automatically suspended.

The tribunal said Ellis’ conduct had been ‘deliberate, calculated and repeated over a period of time’, with his admissions not coming until a relatively late stage.

‘[Ellis], who was an experienced solicitor, had grossly breached his position of trust. His conduct had caused a great deal of harm to the reputation of the profession,’ added the tribunal.

Ellis was struck off the roll of solicitors and ordered to pay £2,000 SRA costs.