A solicitor who was “over his head” in running his own firm, and used a settlement with a vulnerable client to prevent them complaining to the Solicitors Regulation Authority (SRA) or Legal Ombudsman (LeO), has been suspended from practice.
Ashtar Dhami was suspended for six months after the Solicitors Disciplinary Tribunal (SDT) also found a number of accounts rules breaches and other allegations against him proven, including that he had provided inaccurate information to his professional indemnity insurer.
Mr Dhami, who was admitted as a solicitor in 2007, was sole principal of mainly criminal law practice Hanson Young & Co in Harrow, north London. The firm had branch offices in Bradford, Yorkshire and Purley, south London.
The accounting offences related to the Purley office, which operated from September 2013 until it closed in July 2016. Giving evidence, the solicitor said he had intended to close the Bradford office as it was not profitable.
There were three groups of allegations: firstly that Mr Dhami gave an inaccurate declaration on his firm’s insurance proposal form; and secondly that he had breached accounts rules, including that for a period the client account had debit balances of £300,000 and £43,000.
Further, it was alleged that, in breach of solicitors’ rules, Mr Dhami reached a compromise agreement with a dissatisfied, vulnerable client to the effect that she would withdraw all complaints to the SRA or LeO, and not make any more.
The tribunal observed that as a witness the respondent “on the whole, came across as naive rather than furtive. However, whilst… generally he was a truthful witness, some of his explanations were unconvincing when he was pressed on a point”.
Mr Dhami denied that he had reached a compromise agreement in breach of the rules, saying the client “had every opportunity to complain and had done so”.
However, the tribunal found: “A solicitor acting with integrity would have ensured that he did not ask a client, especially a client who was vulnerable, to sign a compromise agreement that sought to prevent that client from pursuing her complaints.”
Mr Dhami also denied the allegation that he provided inaccurate information to the firm’s insurer by telling them that no investigations into the firm had been undertaken by the SRA and LeO when in fact they had.
Among other explanations he said that regarding visits from the SRA he “did not equate this with an investigation” and he “had not read the question as a whole”. He did not accept his declarations had been to avoid his premium being increased.
He had completed the application “in a rush as the insurance broker was chasing for it”. But the tribunal found Mr Dhami “had not met the high professional standards expected of a solicitor”. It continued: “A solicitor acting with integrity would have ensured that he completed the form correctly.”
In respect of the accounts rules breaches, the solicitor admitted the allegations, but said there had been extenuating circumstances, including his wife’s health. Overall, it was alleged that the firm’s accounts were “utter chaos” leading to the Compensation Fund paying out some £57,000.
The tribunal pointed out the solicitor “was responsible for running the business and was [its compliance officer]”. It concluded: “The firm’s records were chaotic and there was no evidence of proper governance or sound financial and risk management principles.”
Deciding sanction, the tribunal determined it would impose “one sanction for the totality of the misconduct”, although it acknowledged “his level of culpability was different for different aspects of the case”.
Concluding, the tribunal said Mr Dhami’s “conduct was a complete departure from the standards expected of a solicitor… [His] misconduct was deliberate, calculated and repeated. It continued over a period of time”.
The only mitigating factor was that the solicitor “had paid some money into the firm to offset some of the loss arising”.
The SDT said it was sympathetic to his personal circumstances. He had limited experience as a solicitor and none of running his own firm. “He expanded into other areas of practice that he did not know anything about. He was ‘in over his head’.”
However, while “there was a need to protect the public and the reputation of the legal profession from the respondent”, the tribunal was not convinced that the level of misconduct justified strike-off.
A six-month suspension would be “sufficient to both punish and deter while being proportionate to the seriousness of the misconduct”.
The tribunal also imposed indefinite restrictions on his practice, including that he could work as a solicitor only in employment approved by the SRA and could not hold client money.
Mr Dhami was ordered to pay costs of £44,000.