A director of collapsed Devon law firm Eastleys who made “blatantly false” statements to third parties has been struck off by the Solicitors Disciplinary Tribunal (SDT).
The SDT also found that Matthew Roddan had repeatedly “lied to his regulator”, the Solicitors Regulation Authority (SRA).
“The sums of money flowing through the firm were very significant,” the SDT said. “The main harm, however, came from the damage to the reputation of the profession.
“The respondent had made representations and undertakings in correspondence which were blatantly false and this was intolerable.
“The public would be deeply concerned that a solicitor would act in this way at the same time as allowing his client account to be used as a banking facility and subsequently not co-operating with his regulator.”
The tribunal heard in SRA v Roddan (case no. 11388-2015 ) that the allegations related to a time when Mr Roddan was acting as a partner within Eastleys and a director of Recompense Limited.
When Eastleys went into administration in August 2012, Recompense, an existing company and firm of solicitors, purchased the firm in a pre-pack deal.
“The firm then operated as Recompense Ltd trading as Eastleys solicitors. Following the purchase of Eastleys solicitors by Recompense Ltd, Recompense itself suffered financial difficulties.”
A report from Begbies Traynor, administrators of Recompense, showed that on its collapse the firm owed nearly £14m to creditors.
The SRA made eight allegations against Mr Roddan, and accused the solicitor of acting dishonestly in relation to five of them – failing to act with integrity, allowing his independence to be compromised, failing to behave in a way that maintained public trust, failing to comply with his legal and regulatory obligations and taking unfair advantage of third parties.
He was also accused of providing banking facilities through the firm’s client account, failing to co-operate with the SRA and comply with written notices, and failing to carry out bank reconciliations.
Mr Roddan “strongly denied” that he had acted dishonestly. However, the SRA found all eight allegations proved and that he had acted dishonestly in relation to two of them, and had acted dishonestly in relation to part of the allegation in two other cases.
The tribunal ruled that Mr Roddan’s motivation for the misconduct was financial, and the possibility of a loan advance from a company referred to as PAG was “seen as essential to ensure the firm stayed afloat”.
The tribunal accepted that “the respondent had not set out to become dishonest and it was not therefore carefully planned, rather the respondent was reactive to the circumstances as they developed.”
The SDT said there was an “element of a breach of trust” in letters Mr Roddan had written to six members of a family and to an investor.
In both cases the tribunal found that Mr Roddan had made statements which were “completely untrue” and given undertakings which were “not in the respondent’s gift to make”. In both cases, he knew that “what he was stating and promising” was false.
Mr Roddan made no submission in mitigation. The SDT ruled that he should be struck off the roll and ordered to pay £27,000 in costs.
Two other directors of Eastleys, Carolyn Anne Hales and Irene Jean Webb made regulatory settlement agreements  with the SRA earlier this year.
They admitted allowing the firm’s client account to be used as a banking facility where there were no underlying legal transactions and failing to carry out bank reconciliations. They were rebuked and ordered to pay £500 in costs.