Accounts: No reconciliations for two and a half years
A veteran solicitor who let his firm’s accounts fall into chaos, causing the SRA Compensation Fund to pay out £400,000 to his former clients, has been suspended from practice.
An external accountant brought into try and sort out the accounts at Leicestershire firm Geoffrey Hill & Co said this was “virtually impossible”, given the state they were in.
The Solicitors Disciplinary Tribunal (SDT) heard that John William Cruickshank, who is 73 and qualified in 1970, was a recognised sole practitioner.
Following an anonymous report received in August 2023, the SRA commenced an investigation six months later, which reported seven months after that, in September 2024.
This concluded that the firm’s books of account could not be relied upon to determine whether it held sufficient client money.
No compliant three-way client account reconciliations had been undertaken since January 2022, client ledgers were “handwritten, incomplete and materially out of date”, no accurate list of client balances and liabilities was maintained, and accountants’ reports had not been obtained since the year to 31 March 2021.
There was a discrepancy £591,000 between stated client liabilities and funds held in client account and the SRA was unable to work out whether this was a bookkeeping error arising from defective records or an actual shortage on client account.
Mr Cruickshank initially told the SRA that the client ledgers were updated daily and remained reliable – only later to admit that this was not the case.
Mr Cruickshank instructed Magma Audit to assist in bringing the books up-to-date but it found this task “almost impossible”.
The SDT recorded: “Magma stated that there were numerous anticipated breaches, that client ledgers contained many inaccuracies, and that the firm’s financial records were beyond practical remedy.”
As a result, the SRA intervened into the practice in October 2024 and recovered £935,000 from the client account.
Given the state of the accounts, the SRA decided it was best to require former clients to claim against the Compensation Fund and it would then recover what was paid out from the statutory trust through which it held the client money.
By March 2025, the fund had received 31 claims and was likely to pay out over £400,000.
Mr Cruickshank admitted the allegations against him in full, including that he had lacked integrity and been reckless.
The SDT said the solicitor had failed “to seek help when it was clearly necessary”.
“He had additional responsibilities because he was an experienced solicitor and the sole manager, the COLP and the COFA of the firm.
“In mitigation, the tribunal noted the respondent’s age and that the SRA had recognised that [he] had suffered ill-health during the relevant period. The tribunal also noted that the respondent had no previous disciplinary findings against him and had had a long and unblemished career.”
It determined as “reasonable and appropriate and in the interests of justice” the sanction jointly proposed by the SRA and Mr Cruickshank – namely nine months’ suspension together with conditions for a further 12 months that will prevent him from practising on his own or as a partner, hold a compliance officer role, hold client money or be a signatory to any client account.
Mr Cruickshank was also ordered to pay costs of £7,727.