Tag Archives: Business

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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Consumer survey reveals most Scots want independent regulation of lawyers, legal services, & introduction of McKenzie Friends in Scottish courts

Which logoWhich? consumer survey reveals Scots want independent regulation of lawyers. MOST SCOTS feel lawyers & legal services should be INDEPENDENTLY REGULATED, according to a survey carried out by the consumer group Which?, echoing their evidence to Holyrood’s Justice Committee during hearings on the Legal Services Bill, which aims to widen public access to justice by opening up Scotland’s long closed monopolistic legal services market, currently controlled by the Law Society of Scotland and its 10,000 member solicitors & law firms.

The Which? survey (pdf) found that around seven in ten Scots (71%) think that legal services should be regulated independently and around six in ten (59%) think it is important that lay people should make up the majority of a profession’s regulator or disciplinary board.

McKenzie Friends for Scotland 3McKenzie Friends for Scotland also supported by most Scots in Which? survey. An even greater percentage of Scots (85%) of those polled supported the campaign to bring McKenzie Friends to Scotland, where people responding to the survey thought it would be useful if a scheme was introduced in Scotland whereby people that couldn’t find or afford a lawyer to represent them in court could have the help and support of a knowledgeable non-lawyer or friend in court (known as a McKenzie Friend) if the judge allows it.

Which? survey found majority support for independent regulation of legal services & McKenzie Friends facility for Scottish Courts :

Which - McKenzie Friends & Legal Services Bill

Which? principal public affairs officer, Julia Clarke, commenting on the results of their survey said : “We think it’s vitally important that legal services in Scotland are regulated by a fully independent body as we feel this is the only way consumers can have complete trust in the system. However, the Legal Services Bill will deliver great improvements for people using legal services in Scotland, and we also look forward to party litigants having the right to the support of a McKenzie Friend in court.”

The Legal Services Bill which came about after Which? lodged a super-complaint with the Office of Fair Trading (OFT) about legal services in Scotland, arguing that existing regulation of the industry was harming consumers’ interests, will enable Scottish consumers to access legal services from a range of organisations, not just traditional law firms.

Scottish GovernmentScottish Government reluctantly proposed access to justice reforms. The Scottish Government however, have been very reluctant to reform legal services in Scotland, due it seems to the likes of Justice Secretary Kenny MacAskill’s well known & publicly expressed loyalties to the legal profession and opposition to independent regulation of lawyers. The SNP administration have went onto changed their mind several times over whether to reform legal services in Scotland, and only after the Office of Fair Trading response to the super-complaint, agreeing the reforms proposed by Which? to the Scottish legal services industry would benefit consumers, have the turtle-slow & varying proposals by Justice Secretary Kenny MacAskill become a bill for Holyrood to consider.

A Scottish Government insider said earlier this week the Law Society remained of the view it should regulate legal services in Scotland, and warned that society officials were continuing a behind the scenes campaign to retain its regulatory powers in the face of stiff public opposition.

He said : “There has been voluminous correspondence & meetings with the Law Society over the regulation question. Clearly they want to keep control even though the general public experience with the Law Society handling complaints is mostly negative.”

You can read an earlier report I wrote on the Law Society’s attempt to remain as regulator of Scotland’s legal services market, here : Consumers & Govt insiders brand Law Society ‘too crooked’ to regulate ‘Tesco Law’ expansion of legal services in Scotland

Law Society of ScotlandLaw Society ‘very bitter’ at losing control over pace of McKenzie Friend debate. A legal insider at the Law Society of Scotland itself said this morning that officials were “very angry” over the pace of the McKenzie Friend issue, which is rumoured to have taken the Law Society by surprise in just how fast the matter has progressed from a petition under consideration at the Scottish Parliament to actual case law where the first use of a McKenzie Friend in a Civil Court action in Scotland was allowed by Lord Woolman during November 2009.

He said : “Personally I view McKenzie Friends as a good thing for Scotland and I welcome the results of the survey by Which? which show most people are in favour of the practice.”

The source also revealed there has been heated discussion at the Law Society’s Edinburgh Headquarters over the McKenzie Friend issue, with senior figures left “very bitter” at losing control over the progress of the McKenzie Friends petition, some apparently fuming with Parliament for “letting this one slip through the net”, effectively smashing the Society’s grip over rights of audience in Scotland.

The legal insider continued : “You might not be surprised at just how far the Law Society have went to prevent the McKenzie Friends issue from entering the public domain and use in the court. I understand several MSPs were privately sounded out by society officials, intent on negatively influencing any wider support at Holyrood for a McKenzie Friend law but it seems the speed of the debate, the Court of Session decision, and publicity over the lack of McKenzie Friends in Scotland has overtaken the society’s blocking tactics this time.”

You can read more about the Law Society of Scotland’s opposition to McKenzie Friends in Scotland, here : ‘Control Freaks’ at Law Society say “No” to McKenzie Friends as Holyrood submission signals resistance to Lord Gill’s civil justice review

You can read my earlier coverage of the Legal Services Bill, here : Legal Services Bill (Scotland) : The story so far

On the matter of McKenzie Friends for Scotland, you can read my earlier coverage here : McKenzie Friends for Scotland : The story so far

Independent regulation of solicitors and the wider legal services market is as I and many others have been saying for years, a must, if consumers are to have the full protection we deserve in Scotland’s legal services market.

At the end of the day, legal services is a business, as lawyers are in it to make money, not simply to uphold the values of justice.

If consumers are to have confidence, and trust in that business, it must be independently regulated by the formation of a body with no ties whatsoever to the legal profession, or sympathetic self regulators who have their own interests in continuing the quagmire of ‘crooked’ self regulation which the Law Society of Scotland have practised for years, directly against the consumers best interests.


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Legal Services Bill : Ex-Law Society Chief Douglas Mill who led campaign against complaints reforms, resigned over anti client memos, now supports independent regulation of lawyers

Douglas Mill 4Former Law Society Chief Executive Douglas Mill, eventually brought down by his own memos. DOUGLAS MILL, former Chief Executive of the Law Society of Scotland who once threatened a legal challenge against the Parliament over regulation reforms, whose secret memos revealed he masterminded a policy of defeating claims & complaints made against ‘crooked lawyers’, and who famously attempted to frame critics of the legal profession for a spectacular mafia style murder attempt on his own colleague, Law Society Chief Accountant Leslie Cumming, (which later turned out to have been staged by rogue lawyers in fear of being investigated for criminal activity), has written to the Scottish Parliament’s Justice Committee admitting that independent regulation of an expanded legal services market is needed in Scotland,,after concerted campaigns by consumer groups & law reformers to open up Scotland’s closed shop legal services market saw the introduction of the Legal Services Bill, currently being considered by MSPs.

Douglas Mill Legal Services Bill Page 1Douglas Mill attacks Law Society for change of views & Parliament for lack of research. Mr Mill, who begins his letter expressing surprise at the volt-face in Law Society of Scotland policy in relation to Alternative Business Structures, going onto criticise and even the lack of a research base on the issues contained in the Legal Services Bill said : “I was privileged to serve on the Scottish Executive’s Research Working Group on the legal services market in Scotland which reported in 2006. One of the issues examined was restrictions on business structures and the conclusion reached by the Committee was The issue of Alternative Business Structures appeared to be likely to stay on the agenda and policy development work would be required to establish the extent to which they suited Scottish circumstances and how they might be best regulated if they were to become a reality in Scotland. To the best of my knowledge no subsequent research or policy development took place. Particularly when this Report identified not just one market for legal services in Scotland but a number of segmented geographical and practice area markets, it is at best very surprising for a Parliament committee to introducing evidence-based legislation to be proceeding without the underpinning research which such a profound piece of legislative change demands.”

Douglas Mill then went onto attack the philosophies contained in the Legal Services Bill as being conceived in the late 90s and early 2000s, when law firms were rolling in profits & giving senior partners huge bonuses. Mr Mill told the Justice Committee that such proposals now ”surely require examination in the current economic climate”.

On the subject of ‘independence of the Scottish Legal Profession, Mr Mill who as we all know is not shy in stating his views, comparing some of the proposals contained in the Legal Services Bill as something akin to forcing a ‘Banana Republic’ legal profession on Scotland (but we already have that, don’t we ?)

Mr Mill stated in his letter to the Justice Committee, again critical of their motives over the Legal Services Bill : “Independence of Scots Law and the Scottish Legal Profession -The Bill strikes directly at the heart of these and it is worrying to hear in some quarters that saying so is in some way “scare-mongering”. The potential for direct Governmental control of the legal profession contained in for instance section 35 could reduce Scotland to the type of legal profession seldom seen outside South America and Equatorial Africa. Whilst there are significant pressures towards the assimilation of Scottish and English law it surely ill-becomes a Scottish Parliament to facilitate that.”

Douglas Mill Legal Services Bill Page 2 & 3Douglas Mill’s view of regulatory difficulties, mostly caused by himself and the Law Society. On the subject of regulation, it is hardly surprising Douglas MIll vents his frustrations at the regulatory aspects of the alternative business proposals contained in the bill. Mr Mill commented : “Regulatory Difficulties – I agree with the issues mentioned by Professor Alan Paterson from Strathclyde University in his Written Submission. I would say however that in my experience of being effectively the regulator of the legal profession in Scotland for approximately 12 years, my views are stronger based on significant direct experience. These difficulties take a number of forms:- (a) Regulation of solicitors at the moment is a relatively straightforward matter as the ultimate penalty is striking a solicitor off the Roll of Solicitors and denying him/her their livelihood. No such significant penalty will apply to non-lawyer proprietors.”

Mr Mill continues in his submission to state the Law Society of Scotland cannot regulate ‘conventional solicitor firms’ and Alternative Business Structures, calling the situation a “profound conflict and an impossibility for the Law Society of Scotland.”

Sadly Mr Mill ignores the fact that most of the Law Society’s regulatory difficulties grew out of his 12 years of being the Law Society of Scotland’s Chief Executive, and continues in a ramble on regulation which ends with an attack on the Law Society itself, who, in Mr Mill’s own words ‘appear’ to have “accepted section 92 of the Bill which simply allows Scottish Ministers to control the representative body is, in the view of many, the final nail in its coffin as a representative body.”

In a strong statement to the Justice Committee on the issue of money laundering laws, Mr Mill goes onto accuse the Legal Services Bill of facilitating ownership of legal firms and their use as money laundering portals, although it seems several Edinburgh law firms have helped clients with dodgy secret foreign bank accounts in countries outside the tax jurisdiction of the UK authorities, leaving Mr Mill’s praise of the Law Society & profession in this regard, rather hollow.

Cash laundering link to law chief stabbing - Scotland on Sunday 29 January 2006Douglas Mill’s 12 years as THE regulator of Scottish lawyers led him to attempt to frame critics for a murder attempt on colleague Leslie Cumming, over reputed money laundering investigations. Mr Mill on the subject of money laundering said : “Whilst money laundering obligations sat uncomfortably on solicitors’ duties of confidentiality when they were introduced, they are now accepted as entirely necessary. Indeed the Law Society of Scotland and the legal profession in Scotland are to be congratulated for their excellent record in this area. The Bill quite simply facilitates ownership of legal firms and their use as money laundering portals. As Professor Paterson says, “Ensuring that the fitness for involvement test is effective to exclude criminal elements from investing in or taking control of law firms is a significant issue.” Significant and impossible to ensure. I have spoken to solicitors in Glasgow involved in criminal law who are very well aware of the potential danger of control by criminal elements.”

Mill continued to condemn the bill’s proposals, saying : ““The money laundering rule of law and mortgage fraud implications are such that with the greatest conceivable respect the mechanisms in the Act are frankly risible.

Douglas Mill might worry about lawyers & criminals coming together, but as I reported earlier, its already happening, on a huge scale : Scotland’s Got Crooked : Police investigation reveals hundreds of crooked lawyers & accountants assisting organised crime gangs

Mill also went onto claim it was inappropriate that lawyers be asked to put their own money into a ‘Guarantee Fund” which would also cover non-lawyers, putting forward the idea that a separate Guarantee Fund should be created by the Scottish Government for the non-lawyer entrants into the Alternative Business Structures legal services market.

Mill said : “Again Professor Paterson is correct in identifying that for the protection of the public, the Guarantee Fund presently operated by the Law Society of Scotland is essential. It is entirely inappropriate for traditional solicitors to be asked to be joint and severally liable for the financial actings of non-lawyer proprietors. The alternative is the funding of a separate Guarantee Fund for Alternative Business Structures. This is an area where the Government has to be careful or the disaster of the Scottish Executry Services Board will be repeated.”

It should be noted that despite Mr Mill’s claims of public protection via the Law Society’s current “Guarantee Fund” arrangements, the Law Society version is itself, mired in scandal and woefully short of funds, which you can read more about here : Ground-breaking’ investigation into Law Society’s Master Policy insurance reveals realities of corrupt claims process against crooked lawyers and here : Advisory : Clients must protect their money from unsafe legal firms as Law Society’s Guarantee Fund fails

In a final swipe at the Scottish Government’s proposals, Douglas Mill attacks the regulatory architecture of the Legal Services Bill, even going so far as to propose an equivalent of the English Legal Services Board, to be independent of the Law Society of Scotland and the Scottish Government – interesting turn around from Mr Mill .. who I’m sure wants to head up any such organisation, much to the detriment of consumers, and Scots everywhere.

Douglas Mill Legal Services Bill Page 4Ex Law Society Chief finally admits independent regulation is a must if the legal services market is to be opened up in Scotland. Mr Mill said : “A Regulatory Architecture – I have to say in passing that the financial memorandum is totally and utterly unrealistic. For Alternative Business Structures to work in Scotland on a regulatory basis there requires to be a strong body independent of both the Law Society of Scotland and the Government and it has to be funded properly. In other words, there would require to be a Scottish equivalent of the Legal Services Board down South with all the costs that would imply. One alternative is however for the English Legal Services Board to have jurisdiction over ABSs with “outlets” in Scotland although this may correctly be seen as politically inappropriate.”

Douglas Mill’s letter to the Justice Committee on the Legal Services Bill can be downloaded in pdf format HERE

Douglas Mill does make some good points, particularly of course on independent regulation of the legal services market – including of course, independent regulation of solicitors. However, if we are to see it, people such as Mr Mill, despite his self proclaimed 12 year experience as THE regulator of solicitors in Scotland, must be kept well away from any ‘independent’ body to ensure the public get the protection they have as yet, never had against ‘crooked lawyers’ and others working in the legal services sector in Scotland.

Would Granny Swear by the Law Society - The Herald June 5 2006Mill’s confrontation with John Swinney effectively ended his run as the Law Society’s Chief Executive. For those not in tune with the recent past, Douglas Mill will be best remembered for spectacularly resigning in January 2007 a few weeks after video coverage was published of his terse confrontation with the now Cabinet Secretary for Finance, John Swinney over Mill’s own memos against clients of ‘crooked’ law firms, which the Herald newspaper reported the previous year had demonstrated a resolve to defeat client’s damages claims against Scottish solicitors & law firms and the infamous “Master Policy” Professional negligence insurance scheme run by crooked insurers Marsh UK & the Law Society itself.

You can read more about Douglas Mill’s resignation over the memo-gate affair, here : Breaking News : Law Society Chief Executive Douglas Mill who lied to Parliament, pursued ‘personal vendetta’ against critics – to resign and some previous reports on Douglas Mill, HERE


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OFT & Which? call for independent regulation of lawyers as Justice Committee hears evidence on Legal Services Bill

Debating chamberHolyrood’s Justice Committee heard regulation must be taken away from the Law Society of Scotland. THE OFFICE OF FAIR TRADING has told the Scottish Parliament’s Justice Committee the Law Society of Scotland should be stripped of its regulation role, to give better consumer protection in any reformed legal services market, after constant revelations in the media and in consumer groups investigations & public surveys of the legal profession’s constant habit of covering up complaints against the rising numbers of ‘crooked lawyers’ working in Scotland’s many law firms.

Office of Fair Trading & Which? call for independent regulation of legal services in Scotland.

The OFT, and Which? both reiterated their points that a separation of the Law Society’s regulatory role from the Society’s main function, which is to represent its member solicitors & law firms .. usually against the interests of clients and consumers, when a complaint arises challenging the conduct or service of a solicitor or law firm.

Sue Aspinal, team leader of the professions team at the OFT, said in reply to a question from Cathy Craigie MSP on the separation of the Law Society’s regulatory role : “From the evidence, we know that we are talking about public perception. If a body were to try to further the interests of both its membership and the public, tensions—even conflict—will arise. The best way in which to avoid conflict is to have a separation of the two roles.”

Julia Clarke, of consumer group Which? commented further on the issue, saying : “Which? believes that there should be a separation between the two functions. The system does not work satisfactorily, so it cannot be said that it is perfect. At the very least, particularly in terms of public perception, separating the two functions would be an improvement.”

Ms Clarke continued : “Obviously, the proposal for a lay majority and a lay chair is good news. That is progress, but our view is that there should be complete separation between the two functions. If that cannot be done, the proposed committee to advise the Government on future regulation is a way forward. It is important that its membership should be drawn from beyond the legal profession. It should certainly have a lay majority and a lay chair. It should be a statutory body because it is proposed that the Government will regulate the regulators. That is not ideal but, if it is to happen, it is important that we have a strong advisory body.”

After an additional question from Cathy Craigie MSP on whether consumers might benefit from more than one regulator in Scotland’s reformed legal services market, Sue Aspinall of the OFT replied : “Competition should normally have benefits for consumers unless there is a particular market in which it is best to have only one provider. The OFT’s position is that approved regulators have an important role to perform in the way that they license and we hope that, if there is demand for a choice of approved regulator, that will develop the number of licensed legal services providers coming through, which will mean that there will be more such firms for consumers to choose from.”

nigel_donNigel Don MSP ‘ill informed’ over lack of client’s access to advocates. Justice Committee member Nigel Don MSP, also Parliamentary liaison to the Justice Secretary Kenny MacAskill, entered the debate on the question of the Faculty of Advocates being left out of legal services reform, apparently putting forward Mr MacAskill’s own view that regulation of legal services by judges of the High Court, rather than consumer watchdogs, would be a preferable model. Mr Don also went onto make an outlandish, unsubstantiated claim that “0.5% of the population were not able to work through a solicitor to get the right advocate …”

Clearly Mr Don hasn’t spent much time with actual members of the public trying to pursue cases through the courts which require the services of an advocate. If he had, he would know his fantastic claim is well out ….

Nigel Don enquired : “I am told that 460 advocates practise in Scotland. That is a fairly small bunch of professional, highly qualified people. Do we really need a complicated structure for the regulation of 460 people who are regulated by the court anyway ?”

Julia Clarke, of Which”? replied : “The consumer principles are the same wherever people live in the UK. People are entitled to the same level of transparency and the same protections in the industry with which they are dealing. If services do not modernise, the consumer has no way of demanding their modernisation—they are just presented with what is available. If there is no opportunity for choice, the consumer cannot make their needs felt and must keep taking whatever is delivered. Unfortunately, that is the case at the moment.”

Nigel Don further added : “Would you not prefer to have a service—especially a legal one—that is regulated by the judges of the High Court rather than by some consumer watchdog? If I want lawyers, whose business is speaking to a court, to act professionally in my interests and the interests of justice, would I not much prefer them to be guided and regulated by the Lord President rather than by another organisation ?”

Julia Clarke of Which? replied : “I cannot see what is wrong with independent regulation that is properly regulated and comes with all the necessary safeguards. I think that everyone was keen that that should be in place and, by and large, that is what is proposed in the bill.”

Law Society of ScotlandEven some solicitors think Law Society is now ‘too crooked itself’ to be trusted with regulatory role. A solicitor described Mr Don’s comments this morning as ‘ill informed’, saying : “Mr Don should come in and ask some clients if he can follow their cases all the way to court. If he did he would realise that obtaining the services of an advocate is not like turning on a tap to get water.”

He went on : “We as a profession can fool ourselves as much as we want about who trusts the Law Society to regulate solicitors, but the fact is the public do not trust self regulation, nor do they have a reason to trust self regulation, certainly going by the numerous bad examples set by the Law Society. Putting the Lord President in charge, as Mr Don suggests, would probably only make matters worse from the public’s perspective, given the fact that even the Lord President was once himself, a lawyer.”

You can read the full report of the Justice Committee meeting and the evidence from the OFT & Which?, here : Legal Servies Bill evidence, Justice Committee Official Report 8 December 2009 and watch the video coverage on the Parliament’s website HERE, or at the following links from InjusticeTV here :

Scottish Parliament : Which & OFT give evidence on Legal Services Bill Part 1 Pt 1 Scottish Parliament : Which & OFT give evidence on Legal Services Bill Part 2 Pt 2 Scottish Parliament : Which & OFT give evidence on Legal Services Bill Part 3 Pt 3

Scottish Parliament : Which & OFT give evidence on Legal Services Bill Part 4 Pt 4 Scottish Parliament : Which & OFT give evidence on Legal Services Bill Part 5 Pt 5 Scottish Parliament : Which & OFT give evidence on Legal Services Bill Part 6 Pt 6

Scottish Parliament : Which & OFT give evidence on Legal Services Bill Part 7 Pt 7

Over the next few days, more will be reported from the Justice Committee hearings on the Legal Services Bill, including coverage of Professor Alan Paterson’s evidence, and sessions with the Law Society of Scotland, Faculty of Advocates, and other sections of the legal profession who attended Parliament.


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Consumer fears as Law Society pleads to Scottish Parliament’s Justice Committee for more ‘closed shop regulation’ of legal services in Scotland

Debating chamberScottish Parliament will hear pleas from lawyer to continue regulating themselves. THE JUSTICE COMMITTEE of the Scottish Parliament will tomorrow, Tuesday 15th December, hear pleas from the Law Society of Scotland to be allowed to continue in its role as self regulator of the lion’s share of legal services in Scotland, despite the fact that for well over three decades now, self regulation of Scotland’s 10,000 solicitors by the Law Society of Scotland has led to the lowest standards of legal services in the western world, and the highest number of complaints made against its member solicitors, many involving serious issues of fraud, dishonesty, and almost endemic negligence from many solicitors & legal firms who promote themselves as some of the ‘most respected’ in Scotland’s legal services marketplace.

The Legal Services Bill, currently being considered by the Scottish Parliament’s Justice Committee, is an attempt to widen public access to justice in Scotland, and also allow legal firms to draw in outside investment, hence the term ‘alternative business structures’, used by the legal profession to placate its desire for more money, but very much less by way of any improvements for consumer protections, which of courses the Law Society of Scotland wishes to keep control of for itself.

You can read my previous reports on the Legal Services Bill, once called the ‘Legal Profession Bill’ by the Scottish Government but changed after some smart-eyed civil servant thought it sounded too ‘pro-the-lawyers’, here : Legal Services Bill for Scotland – an attempt at access to justice, or simply to give lawyers more control over justice ?

Ian SmartLaw Society President, Ian Smart claims the Law Society must maintain regulation to protect its members. The Law Society of Scotland’s current President Ian Smart said today in a relatively unremarkable Press Release that : “The bill is set to reform how legal services can be delivered in Scotland and help provide the means for lawyers to modernise their businesses to meet the needs of their clients. Overall the Society is in agreement with the aims of the bill but we have identified key areas of concern and recommended a number of amendments.”

Mr Smart stated the Law Society’s priorities are :

* A robust regulatory system is put in place to provide strong consumer protections and ensure that high standards are maintained among those delivering legal services. (something the Law Society has never managed since 1947)

* Independence of the legal profession from government must be maintained. (Surely this is in no doubt.)

* A level playing field is required for those in the legal services market, whether as a legal services provider or as a regulator. (level playing fields also have to include consumers, of which the Law Society seems to have forgotten about once again)

* Access to justice must not be hindered. (rich, coming from Mr Smart, given the fact the Law Society of Scotland is the greatest hindrance of the public’s access to justice)

Would Granny Swear by the Law Society - The Herald June 5 2006Former Law Society Chief Douglas Mill’s policy to protect consumers was to wipe out their claims and write secret memos against their complaints, featured in a Herald newspaper expose. What consumer protections is Mr Smart actually talking about ? There is no such thing as consumer protection against ‘crooked lawyers’ in Scotland, where up to 5,000 plus complaints are made each year against Scotland’s less than 10,000 solicitors (in one year the figure was as high as 8,000 complaints) and many complaints involving allegations of theft, embezzlement, fraud, dishonesty and negligence, never see full compensation paid to clients who have to engage the Law Society for years in letters while the solicitor who ripped them off gets away with a Law Society slap on the wrist. You can read a previous report I did on the ‘consumer protections’ currently on offer by the Legal Services Bill, here : Legal Services Bill promises nightmare complaints scenario for consumers as Law Society campaigns to control regulation over ‘Tesco Law’ reform

Ex Law Society Chief Douglas Mill’s grilling by an earlier Justice Committee on consumer protections & poor Law Society regulation left Scots in no doubt the legal profession is rotten to the core.

Ian Smart just couldn’t resist pressing on with the Law Society’s tired line on regulation and how to maintain control over it, going onto comment : “Maintaining regulation, representation and professional support within one organisation means the Society can be an effective membership organisation for Scotland’s 10,000 solicitors, as it acts for a group that is effectively regulated.”

He continued : “We also have to bear in mind that Scotland is a distinct legal jurisdiction with a relatively small and scattered population. This, among the many other considerations, must be taken into account to avoid any unnecessary bureaucratic or financial burden. We look forward to engaging with the profession, Scottish Government, the Parliament and other interested groups in the future development of legal services in Scotland.”

Scotland is a distinct legal jurisdiction only because you keep it that way, Mr Smart. Scotland is a distinct legal jurisdiction which does not allow its people unhindered access to justice and access to the courts, simply because the Law Society of Scotland forces anyone who requires access to justice to use the services of an expensive solicitor who is also a member of the Law Society of Scotland.

How much of an unnecessary bureaucratic or financial burden would it be to allow Scots a voice in the justice system instead of going through one of your colleagues, Mr Smart ? Surely it would be worth it, considering the huge fee notes, many of which are fraudulent these days, that are being handed out by law firms to clients just to make up the profits in these dire financial times …

A spokesman for one of Scotland’s consumer organisations today expressed dismay at the Law Society’s attitude towards the Legal Services Bill, claiming the Law Society ‘was seeking to control the entire debate on access to justice and maintain control over regulation’.

He said : “We have heard all this before from the Law Society when it comes to making any changes to consumer access to legal services in Scotland, however small they may be. The Law Society comes out claiming the house will fall down if it is not allowed to regulate the legal services market and enforce some kind of fantastic standard of service provided by legal practitioners which frankly does not exist if the views of consumers are to be taken into account.”

He continued : “However, I detect a hint of worry in the Law Society’s recent abrupt turn on their attitude towards the debate on alternative business structures, as they clearly feel they are in a much weakened position now that campaigners and consumer groups are consistently tackling the issue of Scotland’s notoriously poor legal services market and the high levels of client complaints.”

“It is to be hoped the Justice Committee will see through the Law Society’s obfuscation of the fact that legal services in Scotland have always been poor, and will always be poor as long as the Law Society has any hand in regulatory matters.”

As an experienced reporter on issues relating to the Law Society of Scotland and regulation of complaints, it is very clear the interests of consumers will only be served by a complete overhaul of regulation of legal services in Scotland, with consumer protection made the first priority, rather than the profession being allowed yet again to maintain the closed shop regulation system which as we have repeatedly seen over the decades, operates a hostile policy towards complaints & disputes between consumers & solicitors.

You can read the Law Society of Scotland’s submission to the Scottish Parliament’s Justice Committee on the Legal Services Bill, here : Law Society of Scotland evidence on Legal Services Bill (pdf) and you will be able to watch the live stream of evidence given by the Law Society representatives at the Justice Committee, tomorrow, by selecting the Justice Committee live video stream on the main page, here : Holyrood TV


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Legal Services Bill submissions published by Scottish Parliament – add yours before 18th December 2009 to help protect Scots access to justice

Debating chamberHolyrood’s Justice Committee publishes submissions on Legal Services Bill. REFORM OF LEGAL SERVICES in Scotland is now firmly on the cards with alternative business structures for law firms, expansion of rights of audience, representation and wider access to justice for Scotland’s consumers being considered by the Justice Committee of the Scottish Parliament.

However, while the legal profession and some consumer organisations such as Which?, Consumer Focus Scotland, and the Government agencies such as the Office of Fair Trading have given their replies, actual consumers of legal services should consider writing into the Parliament with their own experiences of legal services in Scotland.

I have reported previously on the Legal Services Bill and its intentions here : Legal Services Bill for Scotland

So far, a total of nineteen received submissions have been published by the Scottish Parliament’s Justice Committee, which everyone who uses legal services in Scotland would do well to read and add their own letter or submission to the Justice Committee BEFORE 18th December 2009 at the latest. Experiences from actual consumers who have used legal services in Scotland, whether good or bad, are vital to help the debate and ensure the new legislation will help consumers rather than protect old monopolies held by the legal profession over individual’s access to justice in Scotland.

For specific information on the Bill, please contact Andrew Proudfoot, Assistant Clerk to the Committee, on 0131 348 5047 or email or with your written submission.

The submissions can be downloaded on the Parliament’s website in adobe acrobat format, at the following links :

Legal Services (Scotland) Bill – written submissions received

LS1 Scottish Police Federation (10KB pdf)

LS2 Faculty of Advocates (25KB pdf)

LS3 Gilbert M. Anderson, Solicitor (42KB pdf)

LS4 Which? (20KB pdf)

LS5 Thompsons Solicitors (37KB pdf)

LS6 Institute of Chartered Accountants of Scotland (20KB pdf)

LS7 Scottish Law Agents Society (54KB pdf)

LS8 Walter Semple and Catriona Walker, Solicitors (48KB pdf)

LS9 Unite Trade Union Scottish Region (30KB pdf)

LS10 Chartered Institute of Patent Attorneys (21KB pdf)

LS11 Citizens Advice Scotland (33KB pdf)

LS12 Office of Fair Trading (60KB pdf)

LS13 Professor Alan Paterson (41KB pdf)

LS14 Scottish Legal Complaints Commission (17KB pdf)

LS15 Consumer Focus Scotland (57KB pdf)

LS16 WS Society (73KB pdf)

LS17 Law Society of Scotland (80KB pdf)

LS18 Scottish Legal Aid Board (22KB pdf)

LS19 Society of Solicitor Advocates (28KB pdf)


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Holyrood’s Justice Committee calls on public to submit experiences on using & improving Scotland’s legal services market

Debating chamberScottish Parliament calls for evidence on public use of courts & legal services. If you have used a Scottish lawyer or the courts and felt the service you did not receive was tip top, or bordered on the woefully inadequate, now is the time to put those experiences in writing by 1st December 2009 to the Scottish Parliament’s Justice Committee, along with suggestions for improvement, and your thoughts on the proposals contained in the Scottish Government’s Legal Services Bill, which hopes to give Scots wider choice of legal representation and a more accessible, competent and trustworthy legal services market than the current broken model, monopolised by the Law Society of Scotland and so poorly regulated that consumer complaints statistics have previously reached staggering heights of up to 8000 cases a year against less than 10,000 solicitors in private practice.

You can view the current version of the Legal Services Bill here : Bill (as introduced) (469KB pdf posted 01.10.2009)

The Legal Services Bill concerns the provision and regulation of legal services in Scotland. It takes forward the proposals contained in the Scottish Government’s consultation paper Wider choice and better protection – a consultation paper on the regulation of legal services in Scotland published at the turn of the year. That consultation followed on from reform across the legal services market in the rest of the UK, driven initially by the 2004 report of the European Commission on Competition in professional services and also prompted by a “super-complaint” by consumer group Which? to the Office of Fair Trading.

The Bill’s Policy Memorandum advises that the profession is facing significant challenges, including competition from English firms entering the Scottish legal services market and the effects of the economic downturn. The Bill aims to provide the opportunity to offer new forms of service, improve efficiency and innovation within solicitors’ firms, and provide access to different methods of capitalisation.

In practical terms, the Bill aims to broaden access to high quality legal services, by allowing solicitors to operate using different business models, for example allowing them to enter into business relationships with non-solicitors, allowing investment by non-solicitors, allowing external ownership and more generally freeing up the market.

The Bill proposes a system of licensed legal service providers, overseen by regulators approved and licensed by the Scottish Government. The Bill also includes related measures, for example:

  • to support the modernisation of the governance of the Law Society of Scotland
  • to allow the Lord President and the Scottish Ministers to grant professional and other bodies rights to conduct litigation and rights of audience in the Scottish Courts
  • to provide a more direct route by which other professionals, not just solicitors, might be authorised to deal with executries
  • to give the Scottish Legal Aid Board the duty of monitoring the availability and accessibility of legal services.

Legal Services (Scotland) Bill – call for written evidence

The Scottish Parliament’s Justice Committee is seeking views on the general principles of the Legal Services (Scotland) Bill (The Scottish Parliament: – Bills – Legal Services (Scotland) Bill (SP Bill 30)). The Scottish Government has prepared a Policy Memorandum, Explanatory Notes and other accompanying documents (including a Financial Memorandum) which are published to accompany the Bill.

The Bill was introduced in the Parliament on 30 September 2009 and the Justice Committee has been designated lead committee for Stage 1 of the Bill. (The Finance and Subordinate Legislation Committees will also consider the Bill and report to the Justice Committee.) Stage 1 of the scrutiny process is concerned with the general principles of the Bill, although it is also an opportunity to flag up more specific concerns that could be addressed by amendment at later Stages.

The Justice Committee hopes to consider written submissions and to take oral evidence during December 2009 and January 2010 and to report on the Bill’s general principles by mid-February 2010.

In preparation for this, the Committee invites all interested parties to submit views on the Bill in writing. The Committee is interested to hear the views of all organisations, bodies and individuals on the proposals contained within the Bill and their likely impact. Comments do not have to cover all aspects of the Bill, only those proposals which are of interest or concern.

In making a submission, please indicate clearly whether or not you would wish to be invited to give oral evidence to the Committee (on 5 January 2010) to follow up on points made in your submission. If you do wish to give oral evidence, it is essential that your submission is received no later than Tuesday 1 December 2009 so that the Committee can decide, at its meeting on 8 December, whom to invite for the 5 January meeting. (Please note that the Committee may not invite all those who wish to give oral evidence.) If you do not wish to give oral evidence, your submission should be received by the 1 December deadline, if possible, and in any event no later than Friday 18 December.

How to submit written evidence

Before making a submission, please read the Parliament’s policy on treatment of written evidence by subject and mandatory committees. Written submissions should normally be limited to around 4 sides of A4 but, if they need to be much longer than this, they should be accompanied by a short summary of the main points. Submissions should be set out in numbered paragraphs. Where the submission refers to existing published material, it is preferable to provide hyperlinks or full citations (rather than extensive extracts). The Committee welcomes written evidence in English, Gaelic or any other language.

The Committee prefers to receive written submissions electronically (preferably in Microsoft Word format). These should be sent by e-mail to: However you may also make hard copy written submissions to: Justice Committee, Room T3.60 ,The Scottish Parliament, Edinburgh. EH99 1SP Telephone : (0131) 348 5047.

My previous reports on the Legal Services Bill can be viewed HERE

I would encourage anyone who has used legal service in Scotland, to contribute to the Justice Committee’s deliberations on the Legal Services Bill to ensure that a much fairer system of legal services & wider choice of representation is put in place for all Scots. Your input into the debate will ensure the public’s voice is heard against the special vested interests of the legal profession and those who wish to retain market dominance over your right to choose who you want to handle your legal interests.


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