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Fake Legal Aid scam reveals solicitor claims client is being investigated for fraud, faces arrest, demands ‘cash bung’ for ‘no action settlement’

30 Aug

SLAB_logoNot content with £160million, fake legal aid investigation scam by rogue lawyers now demands cash from frightened clients. THESE less than profitable times of law firms during the recession are leading to increased levels of fraud by solicitors against their clients in everything from imaginary fee demands to imaginary court cases, as the latest take on LEGAL AID FRAUD reveals some Scottish solicitors are so desperate for money to fund their lifestyles, they are targeting their legal aid clients by claiming they are being investigated by the Scottish Legal Aid Board (SLAB) for fraud and may face arrest & a jail term, but that a cash payment made privately to the solicitor will settle any case against the clients.

In several cases brought to the attention of Diary of Injustice where it appears cases are funded by legal aid, including at least one criminal case, the solicitors told their frightened clients their legal aid claims were being investigated by the Scottish Legal Aid Board for irregularities in their declarations of assets & finances and that they may go to prison if caught. Clients were then told a cash payment covering up to in some cases, half of their legal aid claims to-date, would prevent any criminal charges being made by SLAB.

Clients are apparently told SLAB would “rather settle the case than take it to court”, but that any settlement “will be taken as an admission of guilt” and the solicitor will have to withdraw from acting on the client’s behalf.

One client allegedly on legal aid was told if she repaid £10,000 in cash to her solicitor, “the money would be forwarded to the Scottish Legal Aid Board who indicated they will agree to a no action settlement”. The client did not have the amount demanded by her solicitor who then reduced his demand to £2,000, again insisting on cash payments, which are currently being paid in instalments from the client’s state benefits although those payments will now cease as of publication of this article today.

An investigation into the cases brought to the attention of Diary of Injustice has revealed there were never any investigations by the Scottish Legal Aid Board in these cases as it transpires most of the cases (except the criminal case) were never funded by legal aid in the first place and therefore could not be investigated by SLAB for legal aid fraud.

Earlier this year in February, the Scottish Legal Aid Board announced increasing numbers of law firms were registering to provide legal aid (pdf), where an increase of 5% in the number of firms registered for civil legal aid (620 to 654), an increase of 3% in the number of solicitors registered for criminal legal aid (1353 to 1392) and an increase of 2% in the number of firms registered for criminal legal aid (562 to 573) took place, noticeably due to the financial downturn. In civil legal aid, the number of applications increased by almost 40% over the past 3 years (22,028 in 2009-2010 and 15,861 in 2007-2008). The current year has seen no diminution of the higher levels of applications.

lindsaymontgomeryLindsay Montgomery CBE, Chief Executive of the Scottish Legal Aid Board commented at the rise of law firms running back to claim legal aid : “This appears to be a continuing effect of the recession with legal firms seeking new or additional income streams, whilst the increase in civil legal aid applications is likely to be a mixture of increased need for legal help as a result of the recession and solicitors willing to take on cases which they may not have previously. This may tie in with recent data** released by the Law Society which suggests that smaller firms in some sectors were finding business more difficult.”

However, as the recession continues, a pattern of rising levels of client fraud by solicitors & law firms across Scotland who are desperate to bring in cash in tough financial times seems to indicate in this latest ploy against clients, the solicitors had set out from the very start to scam their unwitting clients into unrecorded repayments of huge cash sums for non existent civil claims cases which the solicitors claimed had been progressing to or already in a court, and were funded by legal aid.

One client of an Edinburgh law firm who was told she stood accused of committing legal aid fraud said she was too scared to contact the Scottish Legal Aid Board to verify if the claims of an investigation into her finances & life were true. She also told Diary of Injustice her solicitor had shown her “photocopied letters” allegedly from the Scottish Legal Aid Board claiming SLAB were investigating her legal aid application and claims made by her solicitor.

The client’s solicitor refused to give her copies of the alleged letters from SLAB alleging legal aid fraud, and insisted she deal only through him and not contact the legal aid board directly, claiming she may be arrested if she did. The solicitor told his client if she made a repayment of three thousand pounds in cash to the solicitor, the SLAB investigation and any resulting case against her would be dropped.

However, it has been established through sources at the Scottish Court Service, the client’s case, a civil damages claim against her local authority which has allegedly been in the courts for two years, does not exist. The client has now refused to pay any money to her solicitor.

One campaigner pointed out the fact clients caught in this latest scam have been told that after they make a cash payment to settle the supposed investigation & accusations of legal aid fraud, that their solicitor will have to withdraw from their case, makes it very convenient for the solicitor who is likely to face no complaint from gullible clients who feel they are lucky to have escaped arrest for a crime which did not occur. Additionally as the payments are requested in cash, there is no record.

An official from one of Scotland’s consumer organisations today commented on the situation.

She said : “Consumers who are in receipt of legal aid should receive some form of contact from the Scottish Legal Aid Board to their home address registered on their initial application. If not they should check with their solicitor and the Scottish Legal Aid Board to ensure they are not being led up the garden path.”

She continued : “Anyone who feels their legal aid case is dragging on unnecessarily should contact the Scottish Legal Aid Board to find out what funding the board has provided to their case.”

A former employee of an Edinburgh law firm who first blew the whistle on this new type of solicitor-client fraud claimed one solicitor from a firm which recently registered to provide legal aid is accused in a complaint of conning four thousand pounds from a client he told was being investigated by SLAB for a fraudulent legal aid claim, when in reality, no investigation existed. The client foolishly handed over the cash to the solicitor, finding it by selling his car. According to the insider, the cash was not entered into the law firm’s accounts.

Victims of this very creative fraud are in an uncertain position, because as no legal aid fraud technically took place since the cases were never funded by legal aid in the first place, the Scottish Legal Aid Board can do nothing about it.

SLCC LAW SOCIETYSLCC & Law Society are not eager to consider legal aid fraud complaints. The only recourse for clients conned out of tens of thousands of pounds by solicitors who falsely claim their clients are being investigated for legal aid fraud would be for those affected clients to file a complaint with the Scottish Legal Complaints Commission (SLCC) or the Law Society of Scotland, who are well known for dismissing complaints against the legal profession no matter how serious the offences committed or extent of funds lost.

Let’s be honest, neither the SLCC or the Law Society of Scotland are going to want to admit this is occurring within the legal profession, or take any action against it. However, as it appears there are solicitors out there demanding, and receiving large cash payments from their clients which are going undeclared, perhaps HMRC may wish to take a closer look at the Scottish legal profession and how it does business.

If readers feel their legal aid funded cases are suffering from unnecessary delays, I recommend you contact Citizens Advice Scotland, Consumer Focus Scotland, the Scottish Legal Aid Board , and of course, please let us here at Diary of Injustice know what has been happening to your case. You can also let other consumers know about these kinds of solicitor scams, via the excellent Consumer Action Group.

Personally, I recommend large headlines in newspapers and in the online media regarding named solicitors & law firms who are conning their clients as the only way of getting any action these days on complaints against the unsavoury elements of Scotland’s increasingly dishonest legal profession.

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