Tag Archives: Banking

YOUR BANK, M’LORD? The £40m trail of secretive judicial interests, billionaires, aristocrats & offshore trusts in Hampden & Co, Scotland’s latest bank

Judges, mega rich & offshore money mix in new Scots bank. A RICH LIST of investors in Hampden & Co – Scotland’s first new bank in 30 years – reveals members of the judiciary including a suspended judge – among the ranks of billionaires, aristocrats and anonymous offshore trusts who have pumped in £40 million into the financial institution – located in Charlotte Square, Edinburgh.

Among the ranks of investors in the new bank are figures from the judiciary such as the now suspended Sheriff Peter Black Watson – who was suspended from his current judicial duties by Lord President Lord Gill in February of this year – in relation to legal writs linked to the £400m collapse of hedge fund Heather Capital.

Other judicial figures include Court of Session judges and former EU judge, Scottish lawyer & academic Sir David Edward KCMG QC FRSE.

Today, the Judicial Office for Scotland refused to comment on, or confirm the identities of any judges who hold shares in the new bank.

Hampden & Co annual return reveals wealthy shareholder list. In accounts filed by Hampden & Co, Edinburgh, a Michael Scott Jones – is the registered as owner of 200,000 shares.

The Judicial Office refused to confirm or deny if this is the same Michael Scott Jones who is Court of Session judge Lord Jones.

The accounts for the bank also reveal Peter Black Watson is the holder of 400,000 shares.

While the Judicial Office refused to confirm if this is the same Peter Black Watson who was suspended by Lord President Lord Gill earlier this year “to maintain public confidence in the judiciary”, Watson’s identity as one of the shareholders of Hampden & Co has been confirmed in a report in The Scottish Sun newspaper earlier this week.

Speaking to the media today, the Judicial Office refused to be drawn on the issue of judges investments and the need for a register of judicial interests to enable the public to scrutinise judges interests and links to big business, banks and other vested interests.

A spokesperson for the Judicial Office for Scotland would only say : “Personal investment decisions are a matter for individual judicial office holders.

“Judicial office holders are bound by the Statement of Principles of Judicial Ethics and in the event of a case presenting a potential conflict of interests, by reason of an investment or otherwise, will recuse themselves. These recusal decisions are a matter of public record”.

However, it is a matter of public record not one Scottish judge has declared a financial interest in a case which has resulted in a published recusal, and one senior Sheriff – Sheriff Principal Alistair Dunlop – who held shares in Tesco – did not recuse himself in the case involving the supermarket giant.

No public record of any refusals or failures of judges to recuse themselves have appeared in the list of recusals published by the judiciary.

Neither have any financial details of members of the judiciary appeared in the list of recusals.

A petition currently under consideration by the Scottish Parliament – Petition PE1458: Register of Interests for members of Scotland’s judiciary – calls for the creation of a single independently regulated register of interests containing information on judges backgrounds, their personal wealth, undeclared earnings, business & family connections inside & outside of the legal profession, offshore investments, hospitality, details on recusals and other information routinely lodged in registers of interest across all walks of public life in the UK and around the world.

The petition has cross party support from msps who backed a motion urging the Scottish Government to create a register of judicial interests at Holyrood on 7 October 2014 – reported along with video footage and the official record, here: Debating the Judges.

In an investigation earlier this week by the Scottish Sun newspaper, it was revealed there are fears among some of Hampden & Co’s shareholders of a second independence referendum, tax rises and how the business climate in Scotland will fare under policies of the SNP Scottish Government.

The bank’s investor list reveals predominantly rich, unionist shareholders such as tycoon Alastair Salvesen, self-storage tycoon Alister Jack, Greenock-born financier Malcolm Offord, Dobbie’s garden centre chief James Barnes, Edinburgh art dealer Alexander Meddowes and Stirling-based construction tycoons Duncan Fletcher & Duncan Ogilvie, both worth over £50million. Aristocratic customers includes the Queen’s cousin David Bowes-Lyons and the Earl of Rosebery’s daughter Lady Caroline Primrose.

Euripides Investments Ltd, the new bank’s second largest shareholder, is based in Jersey — meaning its ownership is secret and that owners are likely to pay less tax on profits than individual UK shareholders.

Another major shareholder is Guernsey-based Kusapi Ltd.

Hampden & Co are refusing to reveal the identity of a major Chinese investor – Cai Dang Fang – listed in Companies House records as Hampden’s fourth largest shareholder. But it’s not known whether that is a person or a company — and the bank won’t say if they are based in the UK or overseas.

The private bank’s headquarters in Charlotte Square, Edinburgh, are just a few doors away from First Minister Nicola Sturgeon’s Bute House residence.

However, many of Hampden’s super-rich backers are staunch unionists who fear their savings may be hit by a rampant SNP push for full fiscal autonomy and another independence referendum.

Speaking to The Sun – Founder & Chairman Ray Entwistle (70) insisted “we have absolutely no intention of racing into any kind of decision”.

But referring to the SNP’s election success he warned: “I suspect a host of businesses that were anxious over the referendum last year remain partially anxious about what happened last month.

“This bank is registered in Scotland, the head office is in Edinburgh and we have a large number of friends we want to do business both in Scotland and in London.

“We are going to wait and see what happens over the next few months. “And I suspect that a lot of other businesses are waiting to see what transpires politically.”

Commenting on the bank, Deputy First Minister & Finance Secretary John Swinney said: “We have a world-leading financial services sector and a talented workforce, making Scotland a great place for new businesses to locate. The Scottish Government has been clear about its approach to taxation. This will be based on ability to pay, certainty, convenience and efficiency of collection.”


Lord Gill (73) suspended Sheriff Peter Black Watson (61) after demanding sight of a multi million pound writ against Glasgow law firm Levy & Mcrae – Watson’s former law firm –  which is one of several companies being sued by Heather Capital’s liquidator, Ernst & Young, after the fund’s collapse in 2010. Watson was a director of a company called Mathon Ltd, and another – Aarkad PLC – key parts of the Heather empire.

The collapsed hedge fund Heather Capital – run by lawyer Gregory King is now the subject of a Police Scotland investigation and reports to the Crown Office. Gregory King – a lawyer – is named along with three others – lawyer Andrew Sobolewski, accountant Andrew Millar and property expert Scott Carmichael in a police report.

An earlier statement from the Judicial Office for Scotland on Watson’s suspension reported: Sheriff Peter Watson was suspended from the office of part-time sheriff on 16 February 2015, in terms of section 34 of the Judiciary and Courts (Scotland) Act 2008.

“On Friday 13 February the Judicial Office was made aware of the existence of a summons containing certain allegations against a number of individuals including part-time sheriff Peter Watson. The Lord President’s Private Office immediately contacted Mr Watson and he offered not to sit as a part-time sheriff on a voluntary basis, pending the outcome of those proceedings.

Mr Watson e-mailed a copy of the summons to the Lord President’s Private Office on Saturday 14 February. On Monday 16 February the Lord President considered the matter.  Having been shown the summons, the Lord President concluded that in the circumstances a voluntary de-rostering was not appropriate and that suspension was necessary in order to maintain public confidence in the judiciary.

Mr Watson was therefore duly suspended from office on Monday 16 February 2015.”


Today, 18 June 2015 – Hampden & Co., the first private bank to come through the new process to obtain a banking licence, has opened its doors to clients after securing final regulatory approval at the beginning of June. It is the first private bank to be set up in the UK for 30 years and will address the significant demand in the UK for a new, high quality banking service.

Founded in 2010 by Ray Entwistle, the former Chairman of Adam & Company, the bank has recruited an impressive team of over 50 qualified professional bankers and support staff, headed up by Chief Executive Graeme Hartop, formerly CEO of Scottish Widows Bank.

The bank will deliver a traditional private banking service built on long-term client relationships and personal service from offices initially in Edinburgh and London. Capital of nearly £50 million has been raised for the launch, which demonstrates the confidence investors have in the business opportunity.

Ray Entwistle commented: “There is strong demand for a new private bank which delivers the right quality of service with long-term continuity of personnel and speed of decision making. Over 250 shareholders have come to the same conclusion and they have been prepared to back our experienced team with the capital required to launch our new bank.”

Graeme Hartop added: “The timing for launch is ideal as we continue to experience an improved economic environment, strong client demand and a favourable competitive landscape as a large number of the existing banks continue to deal with significant legacy issues. We will deliver a traditional client-led private banking service, fully focussed on client needs and not product sales targets, which will lead to strong client-to-banker relationships. We are delighted to be welcoming clients on board.”


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When “Sorry” won’t do : Criminal law should be used to protect the public from the ‘off the hook’ style self-regulation empires of banking, finance, legal and key public services

Broken regulation applies to many more services than just banks. During a week in which England’s NHS regulator, the Care Quality Commission (CQC) was forced to admit (in response to a review) it had covered up information relating to the deaths of babies at a hospital in Cumbria, and at Westminster, the Cross-party Parliamentary Commission on Banking Standards report recommended bankers found guilty of a yet to be created criminal offence of “reckless misconduct” be jailed, it is not too difficult to put forward the point once more that regulation as we know it is ineffective and does not pose any deterrent to those it purports to regulate.

Let’s face it, if regulators are happy enough to cover up the deaths of babies in hospitals, and profit from such a cover up, what chance does any of us have in getting justice against any complaint lodged with any of the current regulators of any profession or public service ?

Diary of Injustice has previously reported on cases in Scottish hospitals where in one particularly case of the death of baby McKenzie Wallace at an NHS Forth Valley hospital reported HERE, regulation in the form of the Scottish Public Services Ombudsman (SPSO) ‘Complaints Reviewer’, Eileen Masterman, did nothing to explain the tragic events, other than to produce a ‘whitewash report’ which only contributed further to the hospital’s cover up.

Time and again, we are promised change, told “lessons will be learned” and what happened will never happen again, but it does, whether it’s another avoidable death in a hospital, or an avoidable rip off of consumers and those who should face a court and be found guilty escape with a big fat pension while their victims are left to pick up the pieces.

The recommendations of the Parliamentary Commission on Banking Standards tell a story many consumers have known for years when it comes to regulation. With particular regard to the creation of a criminal offence of reckless misconduct, such a move should not only be limited to bankers, rather also it should be applied to all those professions where the long standing cosy clubs of self regulation have seen the public are let down time & again.

The key recommendations of the report on Banking standards could well be applied to the legal system, where client’s lives are regularly ruined by legal ‘professionals’ who rely on their system of self regulation to get them off the hook just as the bankers have so far escaped punishment for their actions :

* A new Senior Persons Regime, replacing the Approved Persons Regime, to ensure that the most important responsibilities within banks are assigned to specific, senior individuals so they can be held fully accountable for their decisions and the standards of their banks in these areas

* A new licensing regime underpinned by Banking Standards Rules to ensure those who can do serious harm are subject to the full range of enforcement powers;

* A new criminal offence for Senior Persons of reckless misconduct in the management of a bank, carrying a custodial sentence;

* A new remuneration code better to align risks taken and rewards received in remuneration, with much more remuneration to be deferred and for much longer;

* A new power for the regulator to cancel all outstanding deferred remuneration, along with unvested pension rights and loss of office or change of control payments, for senior bank employees in the event of their banks needing taxpayer support, creating a major new incentive on bankers to avoid such risks.

Just imagine if the ‘independent’ Scottish Legal Complaints Commission called for the same powers, and demanded the added protection of criminal law for clients whose finances are regularly wiped out by solicitors free to do it again and again …

Similarly, the key points of the report on Banking standards also tell the same story of problems in the legal profession, and those others in the justice system who work in, manage, and rule over our “Victorian” courts system.

* Given the misalignment of incentives in banking, it should be no surprise that deep lapses in standards have been commonplace. The Commission’s Final Report, ‘Changing banking for good’, contains a package of recommendations to raise standards.

* The recommendations cover several main areas including: making senior bankers personally responsible, reforming bank governance, creating better functioning and more diverse markets, reinforcing the powers of regulators and making sure they do their job.

Just as in banking, when there is no incentive to be honest in our justice system, whether you are a member of the judiciary, a court clerk, a solicitor or even a member of a self regulator of solicitors, the same deep lapses in standards have also become commonplace because there is no deterrent in current regulation and no fear of being caught.

The full report on banking standards by the cross party Committee on Banking Standards can be found at the following links :

If we are going to charge the bankers with reckless misconduct for ruining the banks, we may as well also charge the lawyers who ruin countless clients, and get away with it in the same way the bankers have done up to now.

If this were to happen, and the likes of the John O’Donnell’s and countless other reckless lawyers in Scotland face a custodial term for their wholesale thieving, attitudes within the prosecution service would also have to change, particularly in Scotland where our own Lord Advocate’s Crown Office refused to prosecute FOURTEEN lawyers for legal aid fraud.

But of course, when these events happen around the fringes of a stone age legal system where our top judge would rather listen to organ music and play ‘fly me to the moon’ than show up to answer questions in our sovereign Parliament about transparency in the judiciary, and perhaps give an indication as to why judges seem to think they are above the law, then what can we expect ?


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The Crooked & The Crooked : Scottish solicitors claim banks & financial services ‘are historically too crooked’ to own Scots law firms

slasBanks are too crooked to own law firms, FSA is rubbish at regulation, say Scottish Law Agents Society. BIZARRE CLAIMS that High Street Banks and other ‘Financial Service Providers’ are TOO CROOKED to hold majority ownership in equally crooked Scottish law firms have emerged today in a response from the Scottish Law Agents Society to a Scottish Government consultation on proposed changes to the ownership of law firms as laid down in the Legal Services (Scotland) Act 2010, passed last year by the Scottish Parliament only after a raft of changes & amendments had been ordered by the Law Society to water down the Scottish Government’s initial proposals to expand Scotland’s closed shop legal industry.

The Scottish Government consultation on which categories of regulated professionals other than solicitors should qualify to meet the 51% ownership requirement in the Legal Services (Scotland) Act 2010 has caused fierce bickering within the Scottish legal profession over their decades old control of Scotland notorious closed shop solicitor dominated legal profession where members of the public who require access to justice or the courts are forced to go solicitors who are members of the Law Society of Scotland.

Today, amid the fears of lawyers the financial industry will come into Scotland’s legal profession and scoop up law firms, or even open their own and bring much needed competition into the legal services marketplace where solicitors have got used to charging sky high fees for doing very little work on behalf of their clients, the Scottish Law Agents Society issued a series of damning accusations against the financial services sector, essentially claiming financial services providers are historically too corrupt to own a majority stake in a Scottish law firm.

In a response to the Scottish Government consultation, the Scottish Law Agents Society claimed : “The financial services industry over the last 30 years does not inspire confidence in the professional standards in the industry. There have been widespread scandals with the mis-selling of endowment policies, personal pension plans, home income plans, precipice bonds and other structured investment products. Currently there is a further scandal with the mis-selling of payment protection insurance.”

The same is true of the legal profession in Scotland. Solicitors have spent decades mis-selling legal services to clients who end up paying extortionate fees for useless and often unsuccessful litigation.

The response from SLAS continued : “The key to each of these scandals is the selling of the products. Notwithstanding the veneer of professionalism the old adage that financial products are sold and not bought remains true. The whole culture of financial services remains one of sales rather than the provision of professional services where the professional puts the interests of the client ahead of his own interests. The regulatory scheme which has applied since the Financial Services Act 1986 has done little to curb this culture.”

While it is true regulation may well have done little to curb bad practice in the financial services sector, it is equally true regulation in the legal services sector, provided in Scotland by the Law Society of Scotland, Scottish Legal Complaints Commission, Scottish Solicitors Discipline Tribunal & last but not least, the Faculty of Advocates, has collectively done little or nothing to curb the incessant corruption, client rip offs, negligence, dishonesty and bad service which continues to plague Scotland’s legal services sector today.

The statement from SLAS also attacked the Financial Services Authority, claiming : “The present regulator of financial services is the FSA and, despite its wide ranging powers, the provisions of the Legal Services (S) Act 2010 with tests of fit to own and fit to manage are not sufficiently robust to allow us to have confidence that the public would be protected from a sales culture approach which could lead to the mis-selling of legal services.”

It should be noted the response from the Scottish Law Agents Society fail to contain any references to many Scots law firms who are themselves caught up in similar scandals of mis-selling of mortgages & financial products and even legal services to clients who are then forced to lodge complaints with the Law Society of Scotland and Scottish Legal Complaints Commission. Unsurprisingly the Law Society & SLCC are reported to be ignoring such complaints.

While SLAS went onto cover themselves by stating : “It would degrade significantly the intended benefits of the Act and indeed the rationale for liberalising the provision of legal services if regulated professions were restricted only to those of Solicitor and Accountant”. Although it would require approved regulators to evolve and enforce robust “fitness for involvement” tests, it would be inconsistent with the purpose of the Act to deny the opportunity to participate in the provision of legal services to other regulated professionals.” the response indicated they would be happy to form “associations between solicitors and surveyors or indeed any regulated profession as defined in Article 3 of European Directive 2005/36 with one exception“, that exception being the Financial Services Industry.

I am not surprised solicitors are happy to form associations with the likes of surveyors.

Law firms forming associations with surveyors is something I’ve seen first hand in Edinburgh and particularly in the Scottish Borders, usually ending up in a very corrupt arrangement where surveyors dish out fraudulent valuations to house buyers or sellers or solicitors on behalf of executry estates of deceased clients, resulting in one particular case I remember where a single solicitor ended up owning twelve properties, some purchased through middle men after it took years to sell particular properties of deceased clients which ended up being sold in some cases for a quarter of their value during the property value boom between 2000 – 2008.

The response from the Scottish Law Agents Society also came down hard on will writers & confirmation agents, stating : “Will Writers and Confirmation Agents are not professionals. At present they require no proper education and training. The qualifications needed to do that work properly requires the same training that solicitors receive. A full training in and understanding of the law on all aspects of property law, succession, taxation etc, are required to offer proper advice. It is obvious that no one should offer services in Will writing and Confirmation without current practising solicitors trained in that area.”

SLAS continued : “Furthermore we note that there are no adequate mechanisms for consumer complaints to be made and investigated free of cost to the consumer and no evidence of adequate professional standards or disciplinary procedures. There is evidence of widespread consumer detriment in the quality of services provided and in the marketing practices of will writers.”

Clearly standards must be kept, but with the ever increasing amount of fraud by solicitors against executries & wills in Scotland, reaching into the tens of millions of pounds each year or by some estimates much more, I hardly think trusting regulation of the legal services market to the likes of the Law Society of Scotland and the remains of the current self-regulation of solicitors gang, including the SLCC, will do anything to improve regulation, increase public confidence or increase consumer protection in Scotland’s best-to-be-avoided legal services marketplace, even after terms of the much-watered-down Legal Services (Scotland) Act 2010 takes hold.

The Scottish Government were asked to comment on the SLAS response and their accusations against the Financial sector. A spokesman for the Scottish Government said: “The Legal Services (Scotland) Act 2010 will modernise the Scottish legal profession, and will offer firms of every size the flexibility to adopt a business model that works for them and their clients. It will give Scottish firms greater opportunities, within a robust regulatory system, to expand and compete effectively, both within and outwith Scotland.”

“The consultation in question sought views on those who should be permitted to own a majority or controlling share in the new licensed legal services providers. All responses will be analysed and considered along with other evidence before a decision is taken. A report on the consultation will be prepared in due course, and will be available on the Scottish Government website.”

We are therefore left to ask ourselves as consumers of legal services, are banks & financial services providers too crooked to own outright a law firm, or is it just these law firms are themselves too crooked to want anyone else to own them or compete in their markets ?

Judge for yourselves on the evidence aplenty already reported on Diary of Injustice, although you may be forgiven for coming to the conclusion neither of the professions can really be trusted with our financial or our legal & justice needs.


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UK Banking Regulation ‘a joke’ as Financial Services Authority clears Royal Bank of Scotland & ‘World’s Worst Banker’ of wrongdoing over bank collapse

FSAFinancial Services Authority wont publish RBS review’s content but claims RBS collapse was down to bad decisions only. THE SPECTACULAR COLLAPSE of the Royal Bank of Scotland under the leadership of Sir Fred Goodwin, dubbed by the media as the ‘World’s Worst Banker’ was simply down to bad business decisions, rather than corruption or any lack of integrity, so says the UK’s financial regulator, the Financial Services Authority (FSA) in a timely release today while most of the county’s focus remains on winter storms, Russia winning the competition to host the 2018 World Cup (удача!), and yet more expected headlines from Wikileaks on international & domestic political double dealing.

After completing an investigation which began in May 2009, the Financial Services Authority released a statement today after completing its supervisory investigation which began in May 2009. The FSA said RBS had made “a series of bad decisions” and the bank’s failure which led to the massive multi billion pound UK taxpayer bailout, seeing the RBS 84% owned by the Government, was “not the result of any lack of integrity by any individual and we did not identify any instances of fraud or dishonest activity by senior individuals or a failure of governance on part of the board“.

Fred GoodwinSir Fred Goodwin, off the hook, still working and still has a title, unlike many now being made redundant because of the UK banking collapse.The FSA said it would be taking no enforcement action as a result of the investigation, either against the firm or against individuals, so all those who were instrumental in the downfall of the UK’s largest financial institution, and are responsible for the biggest public service cuts ever in this country, along with throwing millions of people’s lives into financial turmoil, get away with it once again. Is this justice ? I think not. However it is consistent with regulation in the UK, that is, in the world of non-existent regulation.

The FSA’s statement in full :

FSA closes supervisory investigation of RBS

In May 2009 the Financial Services Authority (FSA) launched a supervisory investigation into Royal Bank of Scotland Group (RBS), as one of the UK banks that required partial taxpayer bailout support. This work considered if regulatory rules had been broken and what, if any, action was appropriate. The review was necessarily extensive and looked specifically at the conduct of senior individuals at the bank, the acquisition of ABN AMRO in 2007 and the 2008 capital raisings. The FSA conducted the review with assistance from PWC.

The FSA has now completed this supervisory investigation. The review confirmed that RBS made a series of bad decisions in the years immediately before the financial crisis, most significantly the acquisition of ABN AMRO and the decision to aggressively expand its investment banking business. However, the review concluded that these bad decisions were not the result of a lack of integrity by any individual and we did not identify any instances of fraud or dishonest activity by RBS senior individuals or a failure of governance on the part of the Board.

The issues we investigated do not warrant us taking any enforcement action, either against the firm or against individuals. However, the competence of RBS individuals can, and will, be taken into account in any future applications made by them to work at FSA regulated firms.

The FSA’s supervisory investigations into other banks that ‘failed’ during the crisis are ongoing. If they lead to enforcement action being taken then it would be usual for the FSA to make these outcomes public if such actions against individuals or institutions are successful.

The FSA cannot publish the content of the RBS review as information gathered from the bank during the course of the review remains confidential under the Financial Services and Markets Act 2000 (FSMA).

Rob MacGregor for the UNITE union released a statement condemning the FSA’s decision not to prosecute the RBS executives and condemned the FSA as being unable to hold the banking sector to account.

Rob MacGregor, Unite national officer, said: “Once again the Financial Services Authority has demonstrated its weakness and inability to hold the sector to account. The report’s conclusions are an outrage. It is unacceptable to suggest that the behaviour of the management in this iconic UK bank did not ‘lack integrity’ when they brought RBS to its knees, resulting in thousands of staff losing their livelihoods.

“By failing to bring any formal charges against the RBS executives the FSA has allowed some of the biggest villains of the financial crisis to go on enjoying their millionaire lifestyles whilst taxpayers experience cuts and staff face an insecure future.”

We can remind ourselves just what happened to the Royal Bank of Scotland at the hands of Sir Fred Goodwin, who still retains his knighthood and a job, unlike many victims of the public services cuts, including the UK’s armed forces and even the carrier HMS Ark Royal, now sunk twice it seems, the first time by a U-Boat of the Nazi German navy and now sunk again or scrapped as a result of the financial harm inflicted on the country by bankers who are off the hook once again.

Collapse of the Royal Bank of Scotland (Click images to watch video)

The Herald newspaper reported that during the Treasury Select Committee’s evidence sessions, “The four ex-chiefs of Royal Bank of Scotland (RBS) and HBOS admitted to having no formal banking qualifications between them in today’s dramatic grilling by MPs.

“Members of the Treasury Select Committee heard how not one of the witnesses – who presided over two of Britain’s biggest and worst hit banks – had technical banking training. The bosses – including former RBS chief executive Sir Fred Goodwin – were forced to defend themselves against tough questions over their suitability to lead the banks, which had to be bailed out with billions of pounds of taxpayers’ cash.”

“Sir Fred denied he lacked experience, saying he had a degree in law and was a qualified chartered accountant, while also having worked as chief executive of the Clydesdale Bank and Yorkshire Bank before joining RBS. Sir Tom McKillop, previously chairman of now part-nationalised RBS, said he was “certainly numerate”, although he conceded he had not studied banking specifically.”

Disgusting. These people have made fools of our country, our financial system, even our way of life. There are no words at all really to describe what they have done, and the suffering their actions are causing us – but its all ok because Sir Fred Goodwin had an LLB, and since the FSA said it was all just down to a few bad decisions, that’s fine. Right ?


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Advisory : Clients must protect their money from unsafe legal firms as Law Society’s Guarantee Fund fails.

Law SocietyYour money is no longer safe with your lawyer. £50 million plus of money belonging to clients of Scottish legal firms is at considerable risk of loss, after revelations the Law Society’s Guarantee Fund has less than £2 million left in its coffers to cover the millions held by Scottish solicitors on behalf of their clients in everything from house purchases & sales to the administration of wills, investments & settlement payments.

AdvisoryMy advice : Clients should immediately withdraw their funds from any legal firm or solicitor who may be holding monies on their behalf. If you have funds being held by your solicitor, make it your priority this week or as soon as possible to ensure the safety of your wealth, or you may end up losing it.

There is simply no way the legal profession can guarantee the safety of your money in the wake of the financial downturn. You will have to be the best judge yourselves as to how to safeguard your own wealth, but trusting it to your solicitor who lacks any protection for its loss, is no longer an option.

While the news is filled with reports about banks & building societies having to be bailed out by the Government, little attention has been paid to the rate of legal firms heading for disaster, and not forgetting the huge rise in fraud cases involving solicitors falsifying banking records and financial transactions, usually for their own benefit. It is the Guarantee Fund which would cover such frauds on client’s funds, but the compensation scheme run by the Law Society which is supposed to repay defrauded clients, has been unmasked as little more than a theatre spectacle, offering nothing to victims of ‘crooked lawyers’.

I reported earlier on the Guarantee Fund’s problems and client’s attempts to claim from it here : Law Society’s ‘Guarantee Fund’ for clients of crooked lawyers revealed as multi million pound masterpiece of claims dodging corruption

A legal insider at the Law Society said when asked about the Guarantee Fund problems : “We are going to end up in a situation where there wont be enough money coming in from Solicitors to the Guarantee Fund to keep adequate levels of money available to cover failed legal business or lawyers taking their clients money for themselves.”

This claim is backed up by revelations that reserves in the Guarantee Fund only amount to a paltry £1.7 million at this time, and with significant outstanding claims standing at £4.3 million, together with incoming claims expected to reach double figures in the millions this year over buy-to-let & mortgage fraud schemes, there seems little prospect of clients recovering anything from solicitors who decide to take the money for themselves.

As an example to emphasise the lack of safety of clients funds, a client who contacted me who entered into a house purchase transaction with a legal firm now faces a total loss of £185,000, which was handed over to his solicitor who was holding it in the legal firm’s client account on a short term basis while the client’s property transaction went through.

Eleven weeks later, the deal had still not been completed and it emerged the solicitor had taken £47,000 of the clients cash to prop up his legal firm’s huge debt. The solicitor then told the client the seller had made off with his money, and had refused to hand over the titles.

The client uncovered what had actually happened through his bank and an ex member of staff from the legal firm in question, but the Law Society did nothing. The client is still seeking legal representation to sue the Law Society and the solicitor concerned, who continues to represent unsuspecting clients in property transactions.

It is reported that discussions have taken place at the Law Society of Scotland on the idea of seeking external funding to the Guarantee Fund, or even asking for Government assistance of some kind, if the situation arises, as looks the case that the Law Society will not be able to meet its ‘official’ commitment to ‘safeguard’ clients funds – a commitment in reality it has never managed to achieve in the Society’s entire history.

However, fears were expressed by some lawyers that the public might not be too receptive to millions of pounds of taxpayers money being used to keep legal firms and lawyers afloat, given a general antipathy towards the legal profession for their poor regulatory conduct and overcharging of fees over the years for very poor legal services.

During discussions on how best to proceed with the flagging Guarantee Fund, officials warned that any external bailout of the compensation scheme would open up the actual workings of the Guarantee Fund & Master Policy to unwelcome public scrutiny, where questions would arise over the suspicious nature of how client claims for compensation are ‘managed’ and transferred back & forth between the two schemes to delay, deceive and generally thwart payouts to genuine victims of ‘crooked lawyers’.

A leading accountancy firm gave comment last week, claiming there may be up to £100 million of private & corporate clients money held by Scots legal firms which may well now be in unsafe hands.

An accountant with the firm who declined to be named said : “You would be correct in assuming there is a significant risk to funds held by your solicitor or legal firm in current market conditions. The advice we could only offer just now is to bank it and look after it yourself. After all, it’s your money, why let anyone else hold it or manage it in this financial climate.”

So, there you have it. If you currently have money with a lawyer, for any reason at all, take it out of their hands and ensure you put it in a safe place where you control it, not someone else who will only use it to further their own financial gain at your expense.


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Truth & reconciliation must be applied to financial crisis, otherwise ‘better regulation’ plans will fail & public anger against bankers will remain

goodwinSir Fred Goodwin ‘shaken’ after hearing of attack on his home. Yesterday’s attack on the home of former Royal Bank of Scotland Chief Executive Sir Fred Goodwin has generally been accepted by the media, politicians & public as being a result of Sir Fred’s part in the collapse of the RBS.There is of course, no justification for vigilante attacks against the man’s home & family, no matter how strongly people may feel over his actions at the RBS.

Reports of Sir Fred Goodwin’s home attacked by vandals :

While such attacks are fortunately few and far between, the fact is that the widely reported ‘lack of public remorse’ by Sir Fred, and many other bankers for their actions which have led to the global financial meltdown, has triggered a demand by many for ‘heads to roll’ over the banking failures.It may be said, such demands for people to be held to account for their actions, are, reasonable.

However, attacks against individual figures, can and often will be used to stymie the demands & needs of regulatory reform, as we have seen before in Scotland, as was demonstrated with the now slightly forgotten but much more serious attack on another financial professional, the Law Society of Scotland’s Chief Accountant, Leslie Cumming, which occurred in Edinburgh in January 2006.

Accounting Chief Leslie Cumming was attacked in a mafia style hit arranged from within the legal profession.

Cash Link to Law Chief StabbingMedia reports on Cumming attack were used by lawyers against reforms. Various theories are still being considered for the attack on Mr Cumming, ranging from a revenge attack organised by crooked lawyers over Mr Cumming’s investigations of their accounts, to disgruntled clients who lost millions at the hands of crooked lawyers, to even a prospect the attack was carried out by other members of the Law Society intent on giving the profession a sympathetic image in the wake of serious legal reforms to its regulatory structure which the Law Society bitterly fought in Parliament during the latter half of 2006.

Leslie Cumming StoryLaw Society may have caused the attack itself. However it may well be that Mr Cumming, regrettably paid the price for his Law Society colleague’s well known policy of bitter attrition towards people who dared make a complaint to the Society against their lawyer, and the general culture of a lack of accountability within the legal profession as a whole, which in turn led to feelings of bitterness on both sides.

Philip Yelland - Director of Regulation - Law Society of ScotlandPhilip Yelland, Law Society Director of Standards. In the case of the Law Society particularly, the glaringly obvious lack of ability by senior officials such as Douglas Mill, Philip Yelland and many others to even ‘say sorry’ or repair the financial damage their colleagues did to ordinary people, led to many cases of intense hardship, where even in one known case, a client committed suicide over the Law Society’s attempts to thwart consideration of the actions of a crooked lawyer.

Douglas Mill at the Scottish ParliamentLaw Chief Douglas Mill blamed campaigners for attack on colleague but it turned out to be lawyers. So bitter were the feelings by some at the Law Society of Scotland, the then Chief Executive, Douglas Mill, held private briefings with journalists and attempted to blame campaigners for the attack on his colleague, however it soon became clear to many in the following days the attack on Mr Cumming came from within the legal profession itself, and Douglas Mill had little more to offer on the subject, which even to this day has seen not one arrest in connection with the Cumming attack.

2006, the year of the attack on Mr Cumming, was a very bad year for the Law Society of Scotland, one could argue, as bad a year as 2008-9 has been & will be for the Royal Bank of Scotland, and indeed many other financial institutions.

The Law Society in 2006 was to be subject to the same outside scrutiny and independent investigations & public inquiries on the weakness & corruption of its regulation of crooked lawyers which will now have to be implemented on the RBS and the financial sector, where the same weak, closed ranks, soft touch regulation has ended up producing the spectacular financial failures on a global scale, that the same weak, closed ranks, soft touch regulation has produced in the legal sector on a client by client basis for decades.

Scottish Legal Complaints CommissionSLCC – now a rubber stamp for crooked lawyers. The Law Society fought the outside scrutiny and newly created legislation to bring independent regulation of complaints, and simply co-opted the new body with its own members to ensure that even after all the effort of campaigners, ruined victims, and the Scottish Parliament, the new Scottish Legal Complaints Commission simply ended up as another rubber stamp for crooked lawyers.

The banks, now faced with the same calls for more regulation, inquiries, investigations and the same campaigns by consumers against financial wrongdoings, will do the same as the Law Society did in 2006. We will end up with possibly, a new regulator to replace the Financial Services Authority after a year maybe, and then the regulator will end up being co-opted in the same way the FSA seems to have been so co-opted by the financial profession which led to its negligence in allowing the banks to do as they have done, and, collapse.

Michael Clancy - Director of Law Reform - Law Society of ScotlandLaw Society’s Michael Clancy killed off Holyrood attempt to heal ruined clients of crooked lawyers. It doesn’t take much to say “sorry”, and do the right thing .. however, saying “sorry” and doing the right thing, doesn’t seem to be a basic capability of anyone in charge of a bank or a legal firm or indeed a regulator supposedly put in place to ensure that failure & corruption doesn’t take place. Too much money. too much political influence, and soft touch, corrupt, regulation, has led to at attitude of omnipotence where these people and their organisations feel above accountability.

That culture of unaccountability must be ended for all professions, particularly those in the legal and banking worlds, if we are to repair the sins of the past and heal the wounds of ordinary people, and our economy, which have been caused by far too much unchecked greed & ambition by a few who control the many … Truth & Reconciliation is now a much needed medicine.


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Royal Bank collapse : Regulation of lawyers model cannot be used as example for safeguarding public against rule bending bankers who broke our banks

rbs_logoRBS – greatest UK corporate loss to-date. While our great banks such as the Royal Bank of Scotland, Lloyds, and the rest announce huge losses and effectively collapse around our ears on a global scale, the cries grow ever louder from the public and politicians alike, not only in the UK, but all over the world, for stronger, more effective regulation to prevent such disasters happening in the future.

Royal Bank of Scotland announces biggest loss ever :

While the hundreds of billions of pounds of public money flows into these institutions to prop them up, perhaps the public should be asking, will such regulation to prevent such a mess happening to our banks ever come to fruition ?

The short answer to that is “No”, simply because what we have always seen is that when stronger regulation of a profession or industry is proposed, what sets out as a genuine attempt to introduce stronger measures to protect consumers, is stopped dead by many of those same politicians who are now bleating like sheep and blaming everyone other than themselves for the failures of our financial institutions.

Why do those attempts at introducing stronger, more independent regulation, fail at Parliamentary stage ?

Well they fail because the professions who are going to be affected by such regulation, co-opt the parliamentary process and ensure any parts of that planned regulation is either watered down to be so ineffective, or simply removed all together.

There is a prime example of this for everyone to take note of in these dire days of banking collapses – that being the introduction of increased regulation for the Scottish legal profession, during 2006, culminating in the Legal Profession & Legal Aid (Scotland) Act 2007

Despite the work of many campaigners & groups, and consumer bodies, the Law Society of Scotland co-opted the Parliamentary process at the Scottish Parliament, and watered down many parts of the LPLA (Scotland) Act which would have protected consumers of legal services in Scotland much more than what the act currently does.

You can read an earlier report on how the LPLA BIll passed Holyrood with amendments here : Legal Profession & Legal Aid Bill finally passed by Scottish Parliament, with amendments.

You can read more about the bitter battles to push through the LPLA Bill into law here : Scotland’s LPLA Act – not doing well in regulating legal services

As a result of the LPLA (Scotland) Act 2007, we now have the Scottish Legal Complaints Commission, which originally under the previous Scottish Executive, was intended to effectively regulate the legal profession, with also consideration given to historical issues of complaints which had led to the creation of the legislation which created the commission in the first place.

However, with the intervention of the May 2007 election in Scotland, the SNP controlled Scottish Government, more precisely, the administrations of it’s Justice Secretary, Kenny MacAskill, has allowed the legal profession itself to effectively castrate the regulator powers of rigid consumer protection, which were originally intended to put an end to all the ‘crooked lawyer’ problems of the past.

SLCC squareSLCC – as much use as no use at all to consumers. In actual fact, the Scottish Legal Complaints Commission has become such a besieged quango, bereft of public trust & confidence, it has become too afraid to publish pictures of its own members, for fear many consumers will realise that the Commission appointees, made by Kenny MacAskill personally, has become just another lawyers rubber stamp club for corruption and poor service in the legal profession which the Law Society of Scotland has managed to do so well for years.

Scottish Legal Complaints Commission – Would you trust them with complaints against lawyers ?

Scottish Legal Complaints Commission

Audit & Finance Committee montageSLCC prefers secrecy to transparency as FOIs reveal. It turns out the SLCC are just too busy keeping themselves so secret,it looks like they have forgot they are supposed to be there to investigate complaints against crooked lawyers, but with most of the staff coming from the Law Society of Scotland, which created the problem in the first place, where crooked lawyers were being let off the hook in thousands of whitewash investigations, there seems little hope for the SLCC to do any different .. and as things stand it seems we are in for more of the same – a definite example to keep away from in improving regulation of financial services after the banking collapse.

MacAskill tight lippedKenny MacAskill gave £2million ‘gift’ to lawyers quango. Strangely enough, the Justice Secretary Kenny MacAskill has lavished millions of pounds of public money on his shiny new regulator while the quango was actually receiving millions of pounds from the legal profession itself. The SLCC, rather than get down to work as the campaigners including Cabinet Secretary John Swinney had originally hoped, then promptly spent it all on personal pension benefits, salaries, perks, medical benefits and just about anything other than actually helping consumers with complaints against legal services.

You can read more about Mr MacAskill’s multi million pound gifts to the Scottish Legal Complaints Commission here : MacAskill silent on taxpayers £2million ‘write off’ to lawyers quango as Complaints boss reveals Law Society defaulted on levies

The legal profession in effect, re-wrote the rules of regulation and powers that the new legislation of the LPLA (Scotland) Act 2007, was supposed to give the ‘independent’ Scottish Legal Commission to help the public, and the SNP simply sat back and watched, even actually joined in the orgy of fiddling, and made sure it placed those who the legal profession wanted to be on the SLCC, at its helm.

As Mr MacAskill has always said – he will protect the legal profession at all costs. I wonder if John Swinney would be so bold to make such a sweeping statement for bankers and financial services ?

Kenny MacAskill – Claimed in Parliament he would protect lawyers against consumers, out of a great debt owed by the SNP Govt to the legal profession …

So if you are looking for a new model of regulation for the banking sector, to prevent trillions of pounds of public money going on failed banks, while their ex Chief Executives walk away with 690,000 pension perks, then don’t look to Kenny MacAskill or the SNP’s ideas of regulating lawyers, because they simply don’t work .. and don’t look to leaders of the legal profession for much help, because as you can see, those same leading lights of Scotland’s legal elite, couldn’t wait to support the likes of Sir Fred Goodwin, and blame the Government for the failures, rather than the bankers themselves.

Ex Law Society Chief Douglas Mill speaks out in support of Sir Fred Goodwin and blames Govt for RBS failure.

You can read more about Douglas Mill’s support of Sir Fred Goodwin, and rush to blame everyone else for the RBS’s failure here : Royal Bank failure blamed on lack of regulation by ex Law Society Boss who campaigned against stronger regulation of solicitors

And finally … we also learned yesterday that the possible legal case which may have caused the RBS a bit of pain financially, failed at a Sheriff Court in Oban yesterday, when Sheriff Pender ruled on Ian Hamilton QC’s small claims action against the RBS that the complexity of the case meant it could not be heard as a “small claims” action, which would have limited expenses to around £150. Perhaps Mr Hamilton should try suing the ex bosses of RBS in the small claims court personally ?

Ian Hamilton QC’s action against RBS is abandoned


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