Legal Aid fraud running at ‘up to £14m a year’ claims insider, as SLAB refuse to release details on Law Society venture ‘to siphon off public cash’

30 Jan

Legal Aid LockhartLawyers cant count, but they sure can steal, says legal aid board insider. A STAGGERING CLAIM that anywhere up to 10% of the ONE HUNDRED & FORTY ONE MILLION POUND annual budget of the Scottish Legal Aid Board (SLAB), equivalent to FOURTEEN MILLION POUNDS a year is being lost to fraudulent claims made predominantly by solicitors & law firms across Scotland has surfaced as a result of enquiries by Diary of Injustice journalists into vast lists of legal aid claims made by lawyers in connection with their work on civil and even criminal cases which are in some cases, taking up to five times longer to settle than would normally be expected, or in an exponentially growing number of cases, particularly civil damages claims, the cases “seem to be going on forever”, in some cases, taking several years to resolve, or simply be closed without a result even though vast sums of legal aid has been claimed for case work.

The claims of  massive legal aid fraud in Scotland, which insiders at the Scottish Legal Aid Board say is so organised & so complicated it is overwhelming SLAB’s investigation teams, sprang to light after Diary of Injustice began inquiries into massive legal aid claims made by Kilmarnock solicitor & sole practitioner NIELS LOCKHART, who managed to rake in around SIX HUNDRED THOUSAND POUNDS of taxpayer funded legal aid in an unbelievable two years and escaped any prosecution after SLAB officials accused him of making dodgy claims, reported here : One law for lawyers : Secret Report reveals Legal Aid Board, Law Society & Legal Defence Union ‘cosy relationship’ in Lockhart case

The scale of the legal aid fraud problem in Scotland has reached epic proportions, insiders claim, due in part to the recession where many law firms are experiencing such a drop in business, they have turned to what some have dubbed “organised theft” where clients are virtually being pulled off the street, asked if they have anything wrong with them, if they want to make a damages claim against anyone from local authorities to their doctors, and even including their neighbours.

In some of the cases allegedly under investigation, Diary of Injustice has been told by insiders it also appears some law firms in localised areas around Scotland have grouped together to cover each other’s fraudulent legal aid claims in attempts to prevent the Legal Aid Board’s audit & compliance teams from discovering the truth.

However, it appears some at the Law Society of Scotland have noticed the growing trend of media investigations into legal aid, and, amid fears the investigations & bad publicity would spark further difficult questions over where exactly the publicly funded legal aid was going, and how it was being used, new policies & projects were being put in place by Law Society officials to deal with the legal aid issue, which is now seen as key funding to keep many law firms afloat.

One of the ‘new projects’ to target legal aid funds, which appears to have been backed by the Law Society of Scotland, hit the buffers after many of the Law Society’s own member solicitors objected to the remit of the private company formed to handle legal aid payments, accusing the company, ESTO LAW Ltd, which was formed by members of the Law Society of Scotland’s very own legal aid negotiating team, as little more than “a legal firm created to siphon off public cash”

The five directors of ESTO LAW Ltd were John Scott QC (Edinburgh), Ian Bryce (Livingston), Ken Dalling (Stirling), Vincent McGovern (Hamilton) and Stuart Munro (Glasgow). The other directors are Neil Robertson, a partner of Ian Bryce, and John Keenan, a partner of John Scott.

The Law Society of Scotland’s journal reported that ESTO was to offer defence solicitors liable to be called out to police stations at any hour, a means of outsourcing this work without losing the client for any subsequent proceedings. It undertakes that its role will conclude once the police station work has been reported on to the instructing solicitor and to the Scottish Legal Aid Board. “This should relieve you of the pressure of providing out of hours advice, while offering reassurance that your clients are being well advised and will not be lost to you”, its launch document promises. In the same article, the journal also reported that ESTO’s directors had “denied making improper use of information gained in negotiations with the legal aid authorities.”

A SLAB insider described the ESTO Law debacle as another attempt by the Law Society to retake control of the legal aid issue which floundered “… after some lawyers finally twigged where their money would be going, as in not to them!”.

However, when Diary of Injustice asked SLAB to release information regarding dealings between the directors of ESTO LAW Ltd and the Legal Aid Board, little by way of usable information was produced, with SLAB bizarrely claiming it would be “a criminal offence to supply the information” after one of the ESTO LAW Ltd directors objected to public disclosure, even though the discussions surrounded negotiations which would have involved vast sums of public money.

The Scottish Legal Aid Board said in its FOI response : I can confirm that the Board does hold information contained in documents which were received from Esto Law Ltd about the services/proposed services offered by Esto Law Ltd.  However, we consider that we are exempt from disclosing the information because the following exemption applies: Section 26 of the Freedom of Information (Scotland) Act 2002 – disclosure of the information is prohibited, for example, under an enactment.

We consider that this exemption applies because Section 34 of Legal Aid (Scotland) Act 1986 prevents Board employees from disclosing this information without the consent of the applicant/person who supplied the information.  It would be a criminal offence to supply information in breach of this provision.    We contacted the director of Esto who supplied us with various information in emails regarding the services being offered by Esto and asked for his permission to disclose this information to you.  The Esto director confirmed to us that he did not consent to the disclosure of the materials in these e-mails.

However, I can advise that two meetings were held between staff from the Board and representatives of Esto Law Ltd on 8 November 2011 and 23 November 2011 to have initial discussions with a view to ensuring that their proposals met the Board’s requirements for the operation of the Police Station Duty scheme, and our requirements for the registration of firms and connected solicitors.  No formal applications for registration had been made at that stage.  We would expect any new private firm proposing to deliver a new service such as that proposed by Esto to have discussions with us to ensure that their proposals fully met all our requirements.  At no stage did we advise that any special arrangements could or would be made for Esto Ltd.  No minutes were taken of these meetings.

Emails between Board staff to an Esto director about the proposed services to be provided by Esto were also disclosed, showing cosy chats between the former Law Society Legal Aid Negotiating Team and SLAB officials :

ESTO Commsjpg_Page1From: Kingsley Thomas, SLAB Manager of Criminal Legal Assistance

To: Vincent McGovern, Esto 23 November 2011 19:41

Following our meeting this afternoon, I have enclosed a copy of the current detention advice that our Contact Line solicitors are using to record the details of all the calls we receive from the police where a suspect requires advice, either from a named solicitor, a Contact Line solicitor, or a duty solicitor.  As I mentioned today, we are currently revising this form, and introducing a new separate form for personal attendances that we do.  When the new form is finalised, I’ll let you see this.

I can confirm that we will also give some more thought to the question of ESTO being on the duty plans to allow A&A to be provided.

From: Colin Lancaster, SLAB Director of Policy

To: Vincent McGovern, ESTO 9 December 2011 17:13

Thanks for this. It seems to be a draft of the agreement between esto and the client firms, rather than esto’s contract with the esto lawyers. While it’s good to see clarification of the A&A arrangements etc as between esto and client firms, I think the other contract would be the thing we would be keen to see so that we can be clear about the nature of the connection between the esto lawyers and esto, from a compliance and registration perspective. If you are in a position to send us that document, we’d be happy to look at it.

A solicitor speaking to Diary of Injustice tonight ‘hit the roof’ over the disclosures, alleging SLAB & the Law Society appear to have some dark secrets worthy of exposing on how ESTO LAW came about and what its motives were.

He said :“We need to get to the bottom of what was going on with Esto Law and the Law Society. What little has been published appears to indicate there is far too close a relationship with the Scottish Legal Aid Board and the Law Society of Scotland which is not in the public interest when it comes to legal aid matters.”

After many solicitors complained about the ESTO LAW Ltd move to grab legal aid cash, it appears the firm folded and the directors resigned, leaving the Law Society of Scotland to pick up the pieces.

Currently, the Law Society is investigating the issue, however the Glasgow Bar Association have posted an account of a meeting with the Law Society over the ESTO LAW debacle on their website, HERE which appears to indicate the Law Society are as bad at investigating their own fit ups, as they are investigating the likes of solicitors who make off with hundreds of thousands of pounds in legal aid claims each year.


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