Solicitor struck off after failing to pay nearly £5 million into client accounts
A solicitor has been struck off after receiving nearly £5 million from an investment fund in “improper” circumstances and failing to pay it into client accounts as part of “multiple findings of dishonesty”.
The funds related to conveyancing transactions, personal injury cases and industrial hearing cases amongst others.
Richard Anthony Barnett of Barnetts Solicitors was struck off as a solicitor and asked to pay £346,000 by the Solicitor’s Disciplinary Tribunal (SDT).
According to the 112 page judgement, he also led his firm to believe they could expect to receive £2 million in income from the fund which the decision notes they were “very unlikely to receive”.
Richard Barnett also admitted to acting for a client where their interests conflicted with his own, and in another case where the interests of two clients were in conflict with each other.
The second respondent in the case, Anthony Augustine Swift was suspended from practice for six months from 20th July and pay £61,000 in costs.
It also states that both respondents knew that their firm had not complied with the terms of a Litigation Funding Agreement (LFA), which was the reason the firm was given the and that the £4,861,399 in the first place.
It goes on to say that both respondents “knew that the LFA pursuant to which the monies were purportedly advanced did not reflect the purpose for which the Firm intended to use and/or in fact used the monies, and that the intended and actual use of the monies was not properly documented.
“[They] had no intention that the Firm would repay the monies within the time required by the LFA and/or knew or was reckless as to the fact that repayment was extremely unlikely;
“[They] misused the funds received by failing to apply them only towards “Eligible Legal Expenses” as defined in and required by the LFA
“Despite being on notice of the serious risk that the investment fund’s investment manager, in arranging for the monies to be paid to the Firm, was acting fraudulently,
The judgement notes that Mr Barnett also “Misappropriated or caused or permitted the Disappropriation of £643,054.33” for one of the payments into the investment fund.
Referring to Richard Barnett, the judgement reads: “The breaches were numerous and serious in nature, and included multiple findings of dishonesty. There were no exceptional circumstances that the Tribunal could or should take into account in order to mitigate the sentence.
“In order to protect the public from harm and maintain public confidence in the reputation and integrity of providers of legal services, strike off was the only sanction that the Tribunal could impose on the First Respondent.”
It goes on to say “In relation to the Second Respondent [Anthony Swift], the Tribunal first considered his culpability. The Tribunal found that his motivation was, in part, to keep the Firm afloat.
“The misconduct did not appear to be motivated by personal gain as such.
“He did not appear to have any direct control over the Firm’s finances, as the Tribunal had found. The Tribunal was mindful of the Second Respondent’s level of experience and the significant harm caused as a result of his misconduct.
“With that level of experience and the potential for harm, the Tribunal would have expected the Second Respondent to step up to the plate and take a much greater interest as an equity partner.”