Ex-Halliwells partners face legal challenge from firm's administrators

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  • Well, I didn't see that one coming!!!!!!
    How many more will be lining up to take a shot?

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  • only a matter of time before the carpet bombing commenced

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  • It beggars belief that in 2010 partners capital accounts can be in deficit and that drawings accounts are in overdraft. Thankfully the rules concerning joint and several liability provide a clear path to those seeking to sort these allegations out. It doesn't exactly inspire confidence to learn that the accounts of a major law firm may have been treated as a child's piggy bank. Keep digging.

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  • Erm not quite. Those who took the reverse premium, trousered the HLI money, put other business interests ahead of the LLP's interests, misled HMRC, the partners and the staff bear responsibility here. Ian take a bow, you made a complete mess of it and now you are going to have to take your medicine.

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  • Isn't this like the captain of the Titanic saying that the passengers are also to blame for the ship's sinking...... and the stevedors, porters and the ship's cat and ship's cat's brother's travel advisors and that nasty polar bear sat high up on the fateful iceberg? Budge over, make room at the trough!

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  • As we are now seeing, the whole affair and downfall reflects the sheer greed of a few at the expense of the majority, coupled with their complete incompetence at running a business and their arrogance. I hope that the Administrators take early steps to recover as much as they can from these corrupt individuals who should be dishonourably discharged by the SRA for gross misconduct, not being fit for purpose and bringing the profession into disrepute. The equity partners of Lees Lloyd Whitley similarly.

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  • How on earth do the junior lawyers who are working with the ex Halliwells partners who took the reverse premium money trust them or have any respect for them? At least 2 of the firms who came in to offer homes to the discredited equity partners set up sub LLP's which suggests they are non too sure about these people either. Why would anybody want to continue working for a group of people who didn't give them a second thought when they were greedily asset stripping Halliwells? I expect there will be quite a few leavers once the market turns.

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  • @Anonymous 4:47: "As we are now seeing, the whole affair and downfall reflects the sheer greed of a few at the expense of the majority"
    Isn't this Western life?

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  • @Greedy and Stupid 9.15pm: indeed. I wonder also to what extent the FSMs trust the former Halliwells equity partners....

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  • I agree the SRA will have to get involved - will they have any choice but to discharge the worst culprits? How could anybody trust them again after this? It has brought the profession into disrepute as others have said and has obviously made a huge impression on creditors and regulators alike.

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  • The reverse premium and the payment of it to a small group of partners, was no more than a looting of the firm's capital, in circumstances where it was bound to cause the collapse of Halliwells. I've had clients arrested for less.

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  • I agree the SRA should get involved but they will not because if Halliwells thought they could act like this, how many others? And how big the firms?

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  • At the heart of this was a firm which was being run for the benefit of a few in a way which suggests that the financial services and company law reforms of the 1980s were thought to have stopped at Watford Gap and to have had no application to the Mancunian entrepreneurial spirit. For some reason, various Full Members seem not to have understood that the fiduciary duties they were happy to advise their clients about, didn't apply to them as fiduciaries of their LLP.
    Would it surprise any of the readers of this site to discover that this meant that senior partners happily accepted non-exec positions in client companies, co-invested with their clients and happily spun-off parts of the business of the LLP into companies which they themselves owned? Or that the person who once headed up the firm's conflict committee was one of those people and didn't seem to regard that as a problem?
    It would be helpful if the SRA did look at what happened within Halliwells. Anecdotally, it doesn't appear to be too unusual within larger firms outside the City of London although for many of them, behaviours such as this are being relegated to the history books as managers become more aware of the law, their duties and current corporate governance practice.

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  • Re Anon @ 2.56pm from Anon @ 4.47pm 2nd - Frankly if the SRA doesn't take this issue up as a matter of professional importance and urgency then it will discredit itself with the public as the supposed regulating authority and will be seen to be absolutely
    devoid of any authority over it's members. It is a pity that after so many weeks since the collapse, approx 12, there has been no known comment from that quarter. Worrying for the image of the profession.

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  • I wonder if Austin, Craig and others are now choking on their reverse premia?

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  • when the firm can't meet the partners tax obligations and has to take advantage of HMRC's time to pay scheme alarm bells should have started ringing. Instead they all threw more money into the Halliwells money pit. It is more a case of blind faith and a lack of commin sense than being kept in the dark. All the warning signs were there.

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  • @Anonymous | 3-Nov-2010 2:56 pm - none of this would surprise me if it were true. I expect there are still some skeletons to be prized out from the Salford University expense accounts just yet, to this scandal may not end with the administrators taking action. Watch this space.

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  • I have no complaint about people gunning for the founding fathers of Halliwells that treated it like their own private bank. They know who they are.
    I do resent those commentators who just take this as an opportunity to stick the knife in and then dance on the grave of the many honourable professionals ( many of whom were partners) who have suffered as a result of that conduct on the part of a few.
    How many of you truly know what is going on with your firm's finances ? One day you may find that your firm was not quite so whiter than white without your knowledge let alone involvement - you would want people to respect that fact that it was indeed without your knowledge
    What has happened at Halliwells is disastrous but it wasn't anything that the SRA could have influenced - it was the greed of a few who had very little management ability but who just so happened to also be in charge

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  • Don't make me laugh. The founding fathers had retired, left voluntarily or been booted out by Austin by the time the firm failed. A number of sensible heads, work winners and Austin detractors (before it became fashionable to knock the bloke) left or were walked off the premises because they could see what was happening and/or because they refused to listen to the spin and bullsh*t. The few were certainly at fault but the majority were all too happy to go along with it and ignore what ought to have been blindingly obvious.

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  • @Anon 5.17pm - The event might not have been anything that the SRA could have influenced but as the regulating authority it must show that it has the teeth to deal with those that have brought the profession into serious disrepute and act accordingly. Thus far, it appears to have been incredibly quiet on the matter and it ought to, as a matter of professional and public importance, advise what action it proposes to take against those involved in this disastrous affair so as to support the professional image of the majority who conduct themselves professionally and properly.

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  • So far we have allegations of breaches of the rules viz a viz practice management to the degree that cheques were returned due to insufficient funds.
    Add to that allegations of actively misleading the banks (less than full disclosure leading up to the refinancing) misleading HMRC, fellow partners and prospective FSMs and is the SRA still not able to commence an investigation?
    I can understand why some investigations need to be kept under wraps before an intervention and the freezing of client and office monies but I am unable to see why the same might apply here.
    The SRA by not acting or publically stating that they are acting are undermining their own credibility and hence the profession as a whole.
    I wonder if we were delaing with a three partner high street firm (with BME partners) if things might be different and the PC's of those concerned suspended or have conditions attached?
    Sure no client monies were lost but there's still a hole north of £10m which needs filing and that's not something that I think the SRA can shrug its shoulders over and say 'it's a matter for the Courts to decide'.

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