Crooked UK professionals face five-year jail terms; Lawyers and accountants who work for organised criminals will face five-year jail terms under a crackdown on white-collar professionals who profit from crime while turning a blind eye

June 3, 2014 12:01 am

Crooked UK professionals face five-year jail terms

By Helen Warrell, Jane Croft and Sam Fleming

Lawyers and accountants who work for organised criminals will face five-year jail terms under a crackdown on white-collar professionals who profit from crime while turning a blind eye.

Measures, to be introduced in Wednesday’s Queen’s Speech will include a new offence of “participation in an organised crime group” for those who write contracts, rent warehouse space or deliver packages on behalf of gangster networks. This follows an example set by countries such as Ireland, Canada and New Zealand, which already have a “dual conspiracy” system to prosecute professional associates even if they are not directly involved in crimes.

Ministers said hundreds of lawyers and accountants who hide “behind a veneer of respectability” could be caught under the participation offence each year.

The tougher legal regime will also be used to capture so-called “Mr Big” figures who run criminal operations but manage to avoid prosecution by delegating the most risky activity.

Karen Bradley, minister for organised crime, said the new offence was designed to send a “clear message” that anyone “helping to oil the wheels of organised crime” would be prosecuted and jailed.

“For too long corrupt lawyers, accountants and other professionals have tried to evade justice by hiding behind a veneer of respectability,” Ms Bradley added.

The Home Office also suggested that some professionals worked for criminals on a “no questions asked” basis – a claim strongly denied by lawyers.

Rob Moulton, a partner at law firm Ashurst, said there were multiple powers available that could be exercised against miscreant solicitors. “The existing law does not permit a ‘no questions asked approach’,” he said.

Mr Moulton pointed to anti-money-laundering rules, the existing laws covering criminal conspiracies, and disciplinary tools wielded by the Solicitors Regulation Authority.

Nicola Hill, president of the London Criminal Courts Solicitors Association, also suggested that additional laws would increase pressure on solicitors. “There will always be rogue solicitors who ignore the rules so this might not deter them,” she said. “The concern is that any additional work falls on those firms who are already toeing the line.”

We don’t want any law that will blur the edges of what is criminal

– Felicity Banks, ICAEW

But Robin Murray, vice-chairman of the Criminal Law Solicitors Association, was less guarded. “We welcome anything to crack down on dishonest solicitors,” he said. “It helps us not a bit that they exist and give the profession a bad name even if they are extremely rare. No decent solicitor has anything to fear.”

The areas most vulnerable to organised crime include property work, such as conveyancing, or private client work where law firms are used to help move money between different jurisdictions. Litigation is another area where organised criminals can use law firms to launder money by threatening to sue, lodging money in a law firm’s account and then appearing to change their mind and asking for the money back.

Felicity Banks, head of business law at UK accountancy body ICAEW, said existing money laundering legislation made it clear that assisting the retention or control of criminal property was already an offence. “We don’t want any law that will blur the edges of what is criminal.”

Ed Nusbaum, chief executive of Grant Thornton, the professional services firm, said he would “welcome” any enforcement law that discouraged co-operation with criminal activities.

Measures brought in this week aim to help recoup criminal assets, including the £1.48bn confiscation orders that remain unpaid. These include increasing the prison sentences for failing to pay and requiring judges to implement travel bans with confiscation orders to ensure that criminal assets cannot be hidden with spouses, associates or other third parties.

 

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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