Sleazy side of legal profession

AS Leslie Cumming lay bleeding outside his Murrayfield home, the victim of a frenzied stabbing, his cool legal brain was probably already clicking into gear.

While his body fought to stem the flow of blood from a dozen wounds, his mind was whirring through the possibilities of who would have wanted to attack him. It wasn't long before the top law official was able, from his hospital bed, to give Lothian and Borders Police a rundown of lawyers he is and has investigated for suspected money laundering.

Now, two lawyers are to be interviewed by detectives in connection with the attack on the 62-year-old, while police also sift through all the Law Society files that are the work of months of painstaking investigation by chief accountant Cumming and his 12-strong team.

Yet while the attack on Cumming saw the reality of violent crime intrude into his highly regulated world of balance sheets and law books, it has also focused the public interest on corrupt lawyers. Ever since he was appointed chief accountant of the Law Society of Scotland back in 1984, Cumming has taken it upon himself to weed out rogue or "bent" lawyers throughout the country.

Back in the early 1990s, he ensured the Law Society took a hard-line stance against crooked lawyers who embezzled clients' money, changing the five-year inspection of firms' books to two years. The move came after lawyer John McCabe, who had worked for Edinburgh firm Scott Moncrieff & Dove Lockhart, was jailed for ten years for defrauding his clients out of more than 4 million.

More than two years ago the Law Society - which represents more than 8000 lawyers - along with the National Criminal Intelligence Service held a series of seminars aimed at raising awareness about the ways criminals might try to exchange stolen for clean money.

That was when the Proceeds of Crime Act became law, making it illegal for professionals to handle criminals' money without asking questions. As a further safety measure, he also oversaw the introduction of regulations which mean every firm must submit a financial certificate every six months to the Law Society, providing financial information about the firm and confirming compliance with accountancy rules.

Such scrutiny was bound to make him some enemies. Yet Cumming has always maintained that solicitors in Scotland are in the majority honest, with just a few spoiling the reputation of the profession. He has said: "Our system relies on the near 100 per cent honesty of the profession which is what we find time after time.

"It is our duty to the profession and their clients to ensure that those who maintain the highest standards and their clients are protected from the actions of the few who act dishonestly."

Sources in the legal profession claim there are currently 19 lawyers on petition charges - which means they've committed an offence which could mean a minimum sentence of more than five years in jail - although a spokesman for the Crown Office says they have no way of confirming the number as they don't list occupations.

Legal sources also suggest that, despite the Proceeds of Crime Act which could see lawyers face up to 14 years in prison for turning a blind eye to money laundering, there are still those who believe the rewards are worth the risk.

"It all depends on how well your practice is doing, that seems to be the excuse when people are struck off," says one Edinburgh lawyer. "That if business isn't going so well, and they have clients who have money to 'invest' in property, then it becomes an option. But lawyers know the risks. If a client comes in with 100,000 in cash and says he wants to buy something, be it property or shares, bells should be ringing.

"If a lawyer doesn't do the necessary checks, ask the necessary questions and then gets found out to be dealing with dirty money, then they go to jail, it's as simple as that. Most would think it isn't worth the risk, but there will always be those who are blinded by the cash."

Another adds: "The change in the law has been onerous for solicitors. It means that when a new client comes through the door we have to ask for passports, driving licences, utility bills . . . it's a bureaucratic nightmare.

"If there's any reason to suspect the client of trying to pass off stolen money you have to report them to NCIS in England. The solicitors are being asked to police clients rather than the police, and if we get it wrong we go to jail."

Another city solicitor says: "Embezzling has been seen as a way out of trouble for some lawyers in the past, but these days firms' books are gone through with a fine-tooth comb every two years. The accountants at the Law Society know exactly what to look for, so there's no hiding any dodgy practices."

However, despite all the checks and balances, one case which slipped Cumming's net for a decade, until just two years ago, was that of former solicitor John Kennedy Forster. A partner at Stranraer-based solicitors Ferguson & Forster, MacFie & Alexander, he admitted 35 charges of embezzling 667,000 from his clients to pay for school fees, his large home with outdoor swimming pool and foreign holidays.

His sentencing was deferred several times at the High Court in Edinburgh, to allow for compensation proceedings to be resolved and for a report to be submitted by forensic accountants. Finally though on March 18, 2004, he was jailed for six and a half years.

According to Cumming, the case took so long because it "involved a uniquely complex system with the evidence well hidden".

He added: "But as with all cases, once the cracks appeared layer after layer of the fraud was exposed and produced the evidence which we needed and which the Crown then used.

"Most successful frauds involve several strands and depend on a position of particular power or influence. The hardest to uncover are those where there's an element of complicity. It's a constant challenge and each time we find a scheme we ensure that all our inspection teams know about the mechanisms and how it worked so that they can recognise the signs in the future."

Police sources here in Edinburgh believe there are few, if any, corrupt lawyers working in the Capital, and that the Law Society's checks are currently adequate for preventing illegal financial activities, although they admit there will be those who don't get caught quickly enough.

One says: "I've seen a few dodgy lawyers in my time, but not on the financial front.

"There's more organised crime in Glasgow than Edinburgh but then the property market here is much more expensive and so that maybe proves the attraction. But I do think that there's only a few corrupt lawyers in Scotland - although they can be damaging to the whole of the profession."

But perhaps the most telling thing about crime among Scotland's lawyers is that claims on the Law Society's Guarantee Fund - a fund which compensates clients who have suffered loss as a result of a solicitor's dishonesty, and which is paid into by partners in law firms - have steadily fallen under Cumming's tenure.

Each partner pays around 200 a year into the fund, which is in excess of 1 million. For the year 2003-2004, the last year for which figures are available, the total paid out was 187,000, whereas when the fund was first established in the early 1990s, the compensation payouts were as high as 1.35m.

LOWERING THE BAR: CROOKS WHO MAKE UP LAW'S LIST OF SHAME

1991: Edinburgh lawyer John McCabe was jailed for ten years after admitting 34 charges of fraud totalling more than 4 million. He conned banks and building societies into handing over loans of up to 500,000 and ploughed the money into disastrous business ventures. He fled to South America, leaving a taped confession, but returned within a few days and was arrested at Heathrow Airport.

1996: A five-year sentence was handed to David Hoey, a lawyer from Leven, after he was found guilty at the High Court in Edinburgh of stealing more than 500,000 from elderly clients. He had already been struck off when the offence came to light.

1996: After a probe into his firm's financial affairs, Donald Pirie was struck off. A police investigation found that the Cowdenbeath-based lawyer, who lived in East Linton, had embezzled 63,000 from clients, including 40,000 from his parents. He was jailed for five and a half years.

1997: Stephen Crilley pocketed 45,000 in fees due to his firm because he believed he was underpaid. He was a partner with Grant & Wyllie until resigning in 1996 and was struck off the following year. He avoided going to prison by repaying the money.

1997: Pat Elliot was jailed for 18 months after she was found guilty of stealing 60,000 that was destined for two charities from a client's will. Elliot, of Crown Terrace, Glasgow, was also struck off.

1998: Alexandra MacRae, a lawyer who underwent a sex-change operation and was previously known as Steven Raw, admitted to embezzling more than 16,000 from a client's account in order to pay her Dundee firm's debts. She was struck off before later being sentenced to 15 months. However, she appeared in court again in 2001 and was sentenced to three years for embezzling almost 100,000 from an elderly client while she had worked as a lawyer.

2000: William Stevens of Saughtonhall Drive was jailed for four years at the High Court in Edinburgh for embezzling cash from elderly clients to pay for school fees. He was also struck off, although had resigned as a partner with firm Bennett and Robertson in 1997.

2001: Alistair Liddle prompted a police hunt in 1997 after vanishing, leaving his family in Forres, just as the Law Society was to investigate his firm. He was struck off in 1999 and traced to Cornwall in 2001, where he admitted embezzling 17,875 from a client's account. He was jailed for a year.

2001: Solictor Bruce Gordon of Piersfield Terrace in Edinburgh was struck off after being found guilty of professional misconduct for embezzling 55,000 from a dead man's estate. He was jailed for a year.

2003: Alastair Hall, a former partner of A&R Robertson and Black in Blairgowrie, was jailed for 11 years after stealing 500,000 from clients. He admitted five charges of embezzlement, two of fraud and a bankruptcy offence.

2004:Edinburgh lawyer Ricky McAnulty was jailed after admitting embezzling almost 20,000 from the accounts of five clients. He was struck off and sentenced to 18 months in Saughton.

2004: Douglas Criggie, who owned Cumberland Street firm Criggie & Co, was charged with embezzling 50,000 from clients. But his firm was sequestrated after it was discovered he had unpaid loans and bills totalling 300,000 and he went bankrupt. He was struck off by the Law Society in May 2004 and the Crown Office is still considering prosecution.

2005: Glasgow lawyer Calum Blyth was jailed for two years after being found guilty of embezzling 108,000 from his clients and obtaining a further 27,000 by fraud while working for Blyth Solicitors between 1996 and 1999.