SDT: Clear breach of a position of trust
A law firm owner who used client money to shore up his firm and pay personal debts in the face of cash flow problems has been struck off.
Charles Ogbonna Azotam also issued cheques to a client when he knew his firm did not have sufficient funds to honour them.
Mr Azotam, who qualified in 2013, was sole principal of immigration law firm Charles Hill & Co in South-East London, which was shut down by the Solicitors Regulation Authority (SRA) in March 2024.
This followed a complaint to the SRA that the firm had failed to pay out money owed to the beneficiaries of an estate, as well as the firm’s complaint manager, who was a senior associate solicitor, calling the SRA’s to express concerns that the firm’s client account did not hold sufficient funds to meet its liabilities to two clients.
According to a statement of agreed facts and proposed outcome put by the SRA to the Solicitors Disciplinary Tribunal (SDT), Mr Azotam transferred client money to the firm’s business account over four years to pay for a personal debt he owed to BNP Paribas, the office rent, and money owed to a local car dealership, among others.
Mr Azotam was unable to confirm how many transfers he made, nor the total amount involved, but the SRA found a client account shortage of £163,123 as of 31 January 2024, which to date has not been replaced.
The allegations also covered work for a client on the administration of her father’s estate, from which the beneficiaries were due just over £170,000.
Mr Azotam twice issued cheques for £122,000 – because the first was not cashed in time – despite knowing there was not enough money in the client account to cover it. At the time of the second cheque, there was only £6.28.
Finally, the SRA said he did not maintain the firm’s books of account in compliance with the accounts rules, including a failure to complete client account reconciliations, maintain ledgers, lists of client liabilities or a cash book since at least 2020. Mr Azotam failed to obtain accountant’s reports from 2020 as well.
He admitted all the allegations. In mitigation, he said he transferred the money “to support the business due to issues with cash flow” and expressed remorse for his actions.
But he did not contend that any sanction other than a strike-off was appropriate.
The SDT agreed. Mr Azotam acted “in clear breach of a position of trust” – the harm “extended beyond financial loss to clients, encompassing reputational damage to the profession, procedural disruption, and regulatory risk”.
The SRA sought costs of more than £42,000. Mr Azotam said he was “taken aback” by this, given he had admitted his misconduct from the start.
He told the SDT that he was a discharged bankrupt with no savings, and that his means were limited to universal credit, which would shortly transition to pension credit. He also had significant health problems and a young dependant.
The SDT determined that it would not be appropriate to make a costs order when there was no realistic prospect of repayment. It ordered Mr Azotam to pay £1,000.