Cyber crime: Firm failed to warn client
The Legal Ombudsman (LeO) has today published 10 of its final decisions in full, only the second release of public interest findings, and names barristers for the first time.
They also include a law firm that had to pay over £40,000 to its conveyancing client after both were the victims of cybercrime.
The first decisions three were put out in July, with one of the firms involved describing the move as “egregious”.
LeO said decisions were selected for publication where there was a clear public interest, “such as where the issues are particularly serious, systemic, or where publication may help prevent similar serious failings in future”.
The 10 decisions cover serious service failings across a range of practice areas, including immigration, conveyancing, family law and litigation.
LeO said: “They also highlight several recurring issues that firms should take seriously. These include the risks of missing deadlines or failing to respond to third parties, the need to provide clear and accurate costs information, and the consequences of poor communication or acting without a client’s consent or approval.
“Each of these failings can lead to significant harm and undermine trust in legal services.”
There were two direct access barristers named. One was Pauline Lewis, instructed by ‘Mrs B’ to pursue a claim for monies owed on a rental property.
The claim succeeded, with costs deferred to a separate hearing, for which Ms Lewis was unavailable. She passed the matter on to another barrister (‘WL’). Although some of the seven issues Mrs B complained about related to the work done by WL, LeO decided it was fair and reasonable for all the complaints to be against Ms Lewis.
LeO concluded that Ms Lewis failed to provide a client-care letter at the outset. which confirmed her costs and the work she had been instructed to undertake.
The barrister then failed to prepare for the costs hearing, including not putting together a comprehensive court bundle, and did not communicate with WL, who himself had failed to reasonably prepare for the hearing, “giving the court incorrect and confusing information”.
Ms Lewis was ordered to pay Mrs B £800 to reflect “the emotional impact” of the service failings, reduce her fees by 70% (£665) to reflect the limited value of the service, and pay £11,104 to compensate for the money that Mrs B was not able to recover due to the poor service.
The other was Mohammed Latif, who was instructed by ‘Mr A’ to assist with his application for British citizenship. Mr A paid £1,200 for the legal work, expecting Mr Latif to draft and submit his application.
Despite repeated requests, Mr A did not receive key documents, updates or confirmation that his application had been submitted.
Mr A later discovered from the Home Office that no application had been made. The barrister did not respond adequately or at all to Mr A’s questions about what had happened.
LeO ordered Mr Latif to pay £1,630, the then cost of a new British citizenship application, and £650 to recognise the emotional impact and distress he had caused.
The largest award was against Bridgend-based Anthony & Jarvie over its failure to warn a client buying an investment property about the risk of cybercrime.
Shortly before exchange, the client received an email from an address belonging to the firm, telling him to pay his deposit to a different bank account. The firm had actually been hacked.
The firm did not tell him it would never change its bank details – something many now do – and the client was not able to contact it to confirm the account details. He made the transfer and the money was lost to fraudsters. Only some of it was recovered.
While acknowledging that Anthony & Jarvie had been the victim of a crime, “we were not satisfied they had adequate security systems in place to protect against this”, LeO said.
“We also found they did not warn Mr A about the dangers of these sorts of scams, which might have meant he was able to spot and avoid what happened. There was also criticism of the firm’s response when they were told about what had happened. They were slow to report the incident to their IT provider or provide advice to Mr A about what steps he should take.
“We did not find that Mr A bore any responsibility for what happened.”
LeO ordered the firm to cover the loss, subject to some deductions around the fact Mr A was later able to buy the same property at a lower price. It also decided the firm should reimburse Mr A for rent he would have collected for a year had the purchase completed.
The financial loss came to £41,548, with a further £1,000 to acknowledge the “exceptional degree of upset and upheaval caused to him”.
Among the other decisions were an order that Surrey firm Rowe Radcliffe – since shut down by the Solicitors Regulation Authority – pay its client £34,900 for not advising its client properly 21 years earlier about the possible risks of purchasing a property with only 77 years remaining on the lease.
The buyer had insisted that he extend the lease term before the sale, costing the client £45,000. The LeO award was this sum less what the client would probably have incurred in extending the lease at the time he bought it, by asking the seller to serve a ‘section 42 notice’ on the landlord.
Chief Ombudsman Paul McFadden said: “This second round of public interest decisions reinforces LeO’s commitment to using its powers to shine a light on serious service failings. Whether it’s someone left without legal status due to a missed immigration application, a family facing unexpected tax bills during a time of grief, or a homebuyer losing money in a cyber-crime incident, the human impact is clear.
“Publishing these decisions is part of LeO’s broad programme of work to share insight from its work to help raise standards across the sector.
“Legal service providers should reflect on these cases and the lessons that can be learned. Transparency is not about naming and shaming – it’s about learning, accountability, and better outcomes for everyone who relies on legal services.”
A public interests decisions committee consisting of members of the Office for Legal Complaints – the board that oversees LeO – considers and approves the publication of decisions.
LeO said it would published decisions approximately every quarter and they would remain online for 12 months.
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