SRA: agreed outcome
US law firm White & Case has been fined £250,000 by the Solicitors Disciplinary Tribunal (SDT) – five times the previous highest for a firm – over client conflict and confidentiality rule breaches.
The tribunal yesterday approved an outcome agreed by the firm and the Solicitors Regulation Authority that in addition London partner David Goldberg should be fined £50,000.
The highest fine handed out to date is £305,000 to a solicitor [1] who took advantage of a former client. City firm Clyde & Co – just three months ago [2] – and London practice Fuglers [3] previously jointly held the ‘record’ for the highest firm fine, at £50,000.
Mr Goldberg is a solicitor-advocate whose practice focuses on international commercial and investment arbitration. He divides his time between London and Moscow.
The exact detail of what occurred will not become public until the SDT publishes its full decision, which is unlikely to be until next month.
But according to a notice published today, White & Case admitted that it:
- Allowed work to be carried out for clients without causing adequate steps to be taken to ensure that no conflict or significant risk of conflict existed between the interests of clients;
- Allowed instructions to be accepted to undertake further work for clients without causing adequate steps to be taken to ensure the confidentiality of information provided to the firm by clients was protected; and
- Acted recklessly in respect of these matters.
Mr Goldberg admitted that he:
- Acted for clients in circumstances in which there was a significant risk of a conflict of interests between clients;
- Did not take or cause to be taken adequate steps to ensure the protection of confidentiality of information provided to the firm by or acquired during the course of acting for clients;
- Continued to act for clients in circumstances in which there was a significant risk of a conflict of interests between clients;
- Provided confidential information concerning the work being undertaken on behalf of a client in one matter to a partner in the firm involved in acting on a matter, giving rise to a significant risk of a conflict of interest between clients;
- Failed to cause adequate steps to be taken to ensure that no conflict existed between the interests of clients;
- Failed to take adequate steps to protect the confidentiality of information of clients; and
- In respect of the last two findings, “as the partner with overall responsibility for the matter involved, in not making inquiry as to specific matters relating to the client instructions, acted recklessly”.
The SRA did not allege that the firm or Mr Goldberg acted dishonestly.
The notice added: “Further, the SRA, having considered the evidence submitted by and on behalf of Mr Goldberg and the firm, did not pursue allegations of lack of integrity against either Mr Goldberg or the firm.
“The SRA is satisfied that the admissions and outcome satisfy the public interest having regard to the gravity of the matters alleged.”
A White & Case spokesman said: “While it would not be appropriate to comment until the Solicitors Disciplinary Tribunal has published its judgment, we have been cooperating fully with the SRA and accept the orders which will be made by the SDT.
“We are committed to upholding the legal industry’s highest standards at all times, in all of the jurisdictions where we operate.”
In early 2014, the High Court debarred [4] White & Case from acting for Ukranian industrialist Victor Pinchuk, who had been represented by Mr Goldberg, in a $2bn dispute with two other oligarchs, for whom the firm had acted previously, over the risk of client confidentiality being compromised. It is not known whether this was the case at issue before the SDT.