Solicitor failed to funnel fees through virtual firm

Accounts: Solicitor failed to keep up with obligations

A solicitor who took client payments into his own bank account rather than through the virtual law firm he worked for has agreed to leave the profession for at least five years.

The firm, Scott-Moncrieff & Associates (ScoMo), lost some £50,000 as a result.

Rajesh Brightman, a former barrister who became a solicitor in 2014, agreed to voluntarily remove his name from the roll in a regulatory settlement agreement with the Solicitors Regulation Authority (SRA) which means he will not have to face a tribunal.

He undertook not to seek restoration to the roll for at least five years or work for any regulated legal business without first disclosing a copy of the agreement.

An immigration specialist, he was employed as an associate solicitor and then a consultant solicitor at ScoMo, the firm set up by one-time Law Society president Lucy Scott-Moncrieff; it is unlike many virtual firms in that in offer personal as well as business legal services.

Mr Brightman’s consultancy agreement required that money received from clients be paid into the firm’s client account. The firm would then pay him 70% of the fees and retain 30%.

However, between January 2014 and April 2017, he received £285,000 from clients of the firm directly into his own company bank account.

The net total of those transactions was £167,000, of which ScoMo should have received £50,000. Mr Brightman did not account to the firm for that amount. Instead, he spent all the money paid to him, to the point where, on 28 April 2017, his account was £3,300 overdrawn.

However, the SRA said it had ultimately not been possible to quantify the amount of money received as Mr Brightman had not undertaken a proper reconciliation of the financial position.

ScoMo became aware of what was happening when it noted that correspondence received for Mr Brightman was inconsistent with his billing figures.

The agreement said: “Mr Brightman has since explained that he had begun to accept payment into his personal account, as opposed to the firm’s client account, for reasons of convenience, because ‘the firm’s policies on receipt of monies were too onerous for the clients he typically dealt with’.

“Mr Brightman has stated that his wife kept his accounts and was responsible for transferring money from his personal account to the firm, and for billing clients. Mr Brightman and his wife separated at the end of 2015.

“Due to his personal circumstances and his lack of previous experience of keeping accounts, from 2014 Mr Brightman was not able to keep up with the accounts and administration required by the firm.

“He has also admitted that he transferred significantly less money from his personal account to that of the firm, and he failed to properly record his clients on the firm’s client-care system, or to issue bills as required by the firm.”

However, many clients believed he was acting for them via the firm but the solicitor did not provide them with the required client-care information.

Mr Brightman’s consultancy was terminated in April 2017, after when he provided immigration advice at a time when he was regulated neither by the SRA nor the Office of the Immigration Services Commissioner.

Mr Brightman claimed to be supervised by DDR Legal Services. Three directors of this Romanian based legal business were found guilty earlier this year of multiple offences of providing unqualified immigration advice and/or services.

While admitting his misconduct and accepting “ultimate responsibility for his circumstances”, Mr Brightman’s mitigation said health and personal issues and the challenges of working with minimum supervision remotely by his firm were a contributory factor. Plus he was newly qualified whilst working at the firm.

“He also made an offer to catch up with the debt due to his firm and left funds with them on termination. Mr Brightman has stated that the firm was holding approximately £16,000 that he had not claimed from the firm in respect of work undertaken by him.”

He also believed that, in working with DDR Legal, he would be able to legitimately complete work for his clients, having done some due diligence on the firm.

In deciding that the outcome was proportionate, the SRA said it took into account confidential medical information, as well as Mr Brightman’s admissions and cooperation with its investigation.

He is paying costs of £2,000 in monthly instalments of £50.

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