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Halliwells’ ex-managing partner: ‘I gave my life to that practice’

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  • It is true, sadly for those who put their money in. What really got to me was that with a board comprised largely of corporate partners (with Ian as a compensatory litigation bozo), not one of them had the sense to apply the standards they advised their clients were necessary when looking at financial promotion/investment decisions.
    Ian could therefore happily tell the Full Members one set of figures about cashflow and working capital whilst making completely different statements to the Fixed Share Members and potential Full Members, apparently completely oblivious to the legal implications of what he was doing.
    No written accounts of any sense were produced - you were encouraged (should you have had the audacity to question what you were being told as a mere junior partner gimp) to speak to the FD who tried to make Ian's two set of statements match-up.

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  • Its an utter disgrace to say the least. Sadly a sign of the times and the profession (whatever that means).

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  • There probably -hopefully-will be litigation. The problem for the fixed share partners is that RBS is probably going to clear out the coffers of the defendants leaving nothing for them if they were successful in a misrep claim. Something needs to happen to make partners think twice about behaving this way again. Where is the SRA? Too busy to bother with commercial law firms?

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  • Ian Austin features in the latest edition of Private Eye (20 August 2010) in his capacity as chair of the "University" of Salford's audit committee. It seems that they have been instructing Halliwells to threaten to sue students for libel.

    Allegedly.

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  • If you look at the former Board they are a rich group of people and I doubt they would be wiped out by claims running to a couple of million.

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  • @Lord Gnome

    Not allegedly I'm afraid, given I was one of the students threatened!

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  • So there are 100 FSM's who put money in and they claim they were misled. So 100 people have a misrep claim. If each of those people put in £500 there is a substantial fighting fund.
    Obtain some after the event insurance and instruct a litigator on a discounted CFA to bring proceedings against those who allegedly misrepresented the position.
    whilst it seems unlikely that creditor pressure will clean out the Board members how satisfying would it be to see those who behaved in this way bankrupt?
    Worth £500? I would think so.

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  • So are you seriously suggesting that the managing partner of a top 40 law firm knowingly displayed one set of figures to one group of partners and an entirely different set of figures to another group of partners? If this is the case then there is a clear integrity issue and a report should be sent to the SRA. Excuse the pun but something does not add up here. There is a duty of good faith between partners and a solicitor is simply not permitted to behave in this way. Either this is a case of sour grapes and unjustified allegations or there is an extremely serious conduct issue to be investigated. Very disturbing

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  • @'S'

    How else would so many people have been taken for a ride so unwittingly? These are intelligent people. The simplest explanation is misrepresentation. Remember Occam's razor

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  • Far be it from me to interfere on private grief, but if people are to make these people bankrupt, please refer their trustee in bankruptcy to S342A of the insolvency act (recovery of excessive pension contributions)
    PS: what goes around comes around, but it might get there a little quicker with litigation

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  • What about a £21,000 tax bill because Halliwells didn't pay the income tax for six months? Where is the money that was put aside for tax?
    Nice letter from HMRC demanding immediate payment of £21,000 tax otherwise the will seek recoveries in the courts.
    Where does anybody just get their hands on £21,000?

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  • In defence of Ian Austin
    I was as shocked as anyone by what’s gone on at Halliwells, but there’s been a lot of rot talked.
    I’m going to stick my neck out and speak up for the lads over there. First, so they did this hooky property deal where the partners all creamed a few mill each. SO WHAT? That’s capitalism kids. Get real. As I was saying to one of the ex-partners on his yacht in Puerto Banus the other week – who wouldn’t honestly have done the same thing given the choice? I know I have and if it wasn’t for the cowardice of the banks, then I would again.
    The rest is here...
    http://rogercashman.blogspot.com/2010/07/halliwell-landau-rip.html

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  • you lay down with dogs and you get........

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  • Offer a small capital stake in a business that is about to go into administration and then ask a fixed share member to pay you 20k.
    That leaves you 1k to find.

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  • Roger Cashman - you sound at least as big a tard as Ian Austin. See you next Tuesday.

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  • Honest naked greed is far better than disguised naked greed. At least everybody knows where they are

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  • At least Ian Austin has come out and faced the music. He may be a laughing stock but he is taking it on the chin and trying to salvage something from the mess he created. It must be tough for him moving to that little firm and carrying the stigma of failure but at least he is having a go.
    Senior Partner Alec Craig is nowhere near as visible as he once was. Some may suggest he has gone into hiding. In terms of culpability he is right up there with Austin and is probably more to blame because unlike Austin he understood the numbers.

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  • Further information on Ian Austin's "activities" can be found in the most recent copy of the Private Eye (No.1269 20 August- 2 Sept 2010, page 30). This will be of interest to anyone following this story and particularly to ex Halliwells' employees and students of the University of Salford!
    To surmise, Ian Austin currently is Chair of the University of Salford's Audit Committee and a member of the University Council. How long he can remain in this position should be the subject of debate. Austin and other members of the University Council recently amended the University's Royal Charter, allowing themselves to "confer benefits on members of the Council if the benefit has been authorised by the Council". "Benefits" include buying or selling goods, services or land, being employed by or paid by the University or receiving any other financial benefit - things previously not allowed in order to ensure the independence of the Council. Mind you, the old charter didn't stop the University using Halliwells when it threatened to sue an undergraduate student for libel, in connection with a website, which he denies having created. The lawyers' letter in March accused him of "defamation in its most cowardly form" and demanded that he reveal the identities of all contributors to the website. That same undergraduate has now recently written to the University asking whether it would now review Austin's position as Chair of Audit, given that he had led his law firm into administration. He also asked under freedom of information how the University decided to use Halliwells to send letters to its students, and whether Austin had been any party to that decision. His request was refused as "vexatious"!
    I think every one of us needs to ask at this juncture, why do we all continue to let these greedy capitalists get away with it? The apparatus of the Criminal Justice System in a bourgeois society isn't going to assist, hence the fact this Austin guy is living it up as a millionaire.

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  • The Information Commissioner is getting ever closer to forcing the University of Salford to publish its expenses data (which Austin, as Chair of Audit, has had a hand in suppressing from publication thus far).
    If those reading think Halliwells LLP has a poor record under Austin's not-so-steady hand, be aware that Salford University managed to clock up a staggering £37 million (!!) in expense accounts for the last financial year, and thus far nobody is any the wiser as to what exactly this was spent on.

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  • Let's hope it wasn't more Louis Vuitton luggage.......

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  • Question: what exactly do the Law Society and the Solicitors Regulation Authority do? Surely these former equity partners of Halliwells should be the subject of investigation and criminal prosecution.

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  • Afraid Private Eye might be well on the money when it states that SRA has come to stand for "Supine Regulation Authority".

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  • The Salford University story is extemely worrying. I bet Heatons didn't see that one coming. Let's hope he has delivered some clients (Salford University?) otherwise the junior staff will be questioning the wisdom of the partners who appointed him and departures/recruitment difficulties will ensue.
    We are all looking forward to seeing what the Administrator/the bank/the Landlord of Spinningfields/the Landlord of King St/the Landlord of St James's Court/the Landlord of the London premises/HMRC and the FSM's are going to do next. A winter of discontent followed by frenzied litigation looks like a good bet.

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  • What is known for certain is that University Council (of which Austin is a member) has been dipping into the charitable accounts to have weekend binges at expensive Lake District resorts under the guise of 'strategising' the future of the University. How much work has been done given the alleged quantities of alcohol involved is open to dispute.
    With £37 million of expenses on the books (nobody has yet examined the receipts that make up this enormous sum of money, which is actually more than the University has raised in tuition fees from its British students in the same financial year), there are likely to be all kinds of bodies buried in the financial yard.
    Those who appointed Austin as Chair of Audit deserve particular praise for spotting a compliant squanderer when they saw one, and it must be said they got a handle of his character long before RBS, Halliwells or the SRA even became suspicious. Over the last few years, this has allowed Salford University to dump well over £120 million of financial profligacy under the heading 'expenses' in the Annual Accounts.

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  • Austin "Lookalike" Warden Samuel Norton of Shawshank. There's more than just a slight resemblance! Watch the film again. Oh and Austin if you are reading this, that was NOT a compliment. Although in your (under) world, it probably was!
    Ex Halliwells employee.

    P.s I can't wait until I bump into you!

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  • If the comments get to 200 then this will surely be the most commented on story the Lawyer has ever seen. The Halliwells debacle was one thing but there were no real surprises in Manchester and parts of London when the Firm collapsed. The Salford University story is a brand new revelation and has opened up a whole new chapter. The story in Private Eye promotes Austin to celebrity status and it can only be a matter of time before Panorama carries out a full and detailed investigation into Halliwells collapse.
    Does anybody know how much Austin is paid by Salford University?
    Will the name Austin creep into the English Language in the same way as the name of the inventor of the flushing toilet?

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  • With all the comments about litigation (some of which are presumably not from FSMs) should we not propose contributons to a fighting fund? How about loans that are only repayable on successful action? Some of the money could even be used to find Alec Craig. The Law Society still has him as a M of Halliwells LLP.

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  • Yes whatever it takes, but I think all the other foul ex Halliwells' equity partners should be in the frame too. And I don't just mean the ugly women ones. As solicitors we actually have an obligation under the Solicitors Code to report to the SRA (if it hasn't already been done). Let's face it, we all have good reason to doubt the integrity of this unscrupulous lot! They have been taking the *iss and are laughing at every one of us, despite what lies they will tell you. However, as fat cats go they are still too small fry not to be made an example of by the SRA. So let's start taking some action. Who knows it may even deter our new management from doing the same to us!! Do we even know whether the Hill Dicks equity partners took a reverse premium on their new premises?? People are too busy boot licking round the next bunch of bosses and wowing at nice new premises instead of ACTUALLY DOING SOMETHING! Start getting evidence sent to the SRA (you can do this anonymously). There probably won’t be a spare law firm to bail you out next time. So as Brown,Russell ,Mason et al are stuffing their fat bellies, you'll be stacking shelves in Tesco.

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  • I'm delighted at the flurry of activity to ensue after the Salford University revelations - given it was me who broke the story.
    Austin - if you're reading, I've got a very, very long memory, and I do not take kindly to being threatened. Perhaps you ought to have stopped and considered what you were doing before you allowed yourself to be complicit in squandering vast sums of my money then instructing one of your shockingly awful lawyers to follow this up with a lengthy diatribe full of menacing language and few facts.
    Lets just wait and see what those £37 million of expenses at Salford contain, shall we?
    @Anonymous | 2-Sep-2010 8:12 am
    It is not a matter of public record how much Austin is paid as Chair of Audit at Salford, unfortunately.

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  • Come on students at Salford Uni. If this load of ex Halliwells fixed share "partners" (or employees as they ought to be called) haven't got the balls to stand up for themselves - you nail him! Just been looking into that MediaCityUK ...and Jon Corner appointment.....mmmmmmmmm... doesn't smell fishy AT ALL.

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  • He and Conman Blair would make a good team. Both blind to their own failings, which are only too obvious to any observer and even more so to those who have suffered from the fall-out.

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  • Another 3,500 people to lose their job at the effectively nationalised RBS. This is in addition to the 9000 job cuts announced last year. These dirty equity partners of Halliwells, and their £20m loan from RBS which enabled them to pocket a reverse premium for more or less the same amount , are responsible for this along with all the other capitalist pigs out there. Hey, Austin etc, I wonder if you will now undertake some half hearted corporate social responsibility to help raise money for people who may now lose their home as a result of these job losses. Oh no I forgot, you guys only do that sort of charity thing when there's a greasy pole to climb e.g one leading to equity partnership or a lucrative role on the board of a Greater Manchester University

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  • These allegations need to be investigated by proper investigative journalists. We own most of the RBS and they have been totally shafted. The Landlord has been shafted, the FSM's have been shafted, Salford Uni is in itself an interesting story but add in what has happened at Halliwells and it becomes a very interesting story. Maybe Mr Austin was just a man out of his depth but there is a lot of smoke swirling around. It is a shame Paul Foot is not around.

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  • I will go without my lunch for 1 week, Greg's will suffer but it iwill be worth it. Despite my belly rumbling for its daily sausage roll I will store up the coppers and by the end of next week I should be able to weigh in with at least £2.64. If every angry young man and woman out there do the same then we are in business.

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  • @ Panorama | 2-Sep-2010 8:54 pm
    I assure you if there is anything irregular in the accounts of the University of Salford, I shall be nailing Austin for that. I have been pursuing the detailed breakdown of these accounts for well over a year now and am waiting patiently for the Information Commissioner to issue a decision notice compelling the University publish the pertinent data.
    As for RBS, the Landlord and Halliwells etc, I do not know enough about these areas to properly investigate. I would be happy to receive advice and see what I can turn up.

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  • I take my hat off to you (Anonymous 3 Sept 12:19). There certainly appears to be information Salford Uni doesn't want made public. Please keep us updated.

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  • Would appear one of the subjects of the recent Private Eye article has resigned from Salford University's Council.
    True to form, Ian Austin's still hanging in there.

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  • ....it tends to be the rats and cockroaches that survive.

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  • Alec Craig was spotted driving a Range Rover in Manchester city centre yesterday afternoon. Rumours that 'sponsored by RBS' was emblazoned down the side are as yet unconfirmed.

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  • "Property of RBS" might be more accurate.
    Must be a bit difficult to carry-off your usual Manc swagger if your financial incontinence has led directly to the biggest collapse of a law firm to date and the whole town knows it.

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  • I thought I saw Ian Austin in a restaurant, so made a point of talking to whoever would listen very loudly about the Halliwells collapse.

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  • How we all laughed when we read this....not. Why not take your medicine like a man Mr Austin instead of a self-serving spineless little bully boy. You took the gain, as they say, now take the pain. Are we really meant to feel anything other than contempt from a man that lacked so in the cojones department when push really came to shove? Why cant he spout his drivel elsewhere? Please dont give him any more column inches - he's had far too many over the years for his own good. Do you think his ego will be dented by what's happened? not a bit, all this is saying is "nowt to do with me, chief".

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  • He ought to be less arrogant now the landlord of st James court has demanded 3.5m in rent. Lol not so cocky now eh big man?

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  • Austin and 4 others gave personal guarantees on the old premises. He is going to lose a lot more than 700k
    My maths like his is really poor. What is 3.5m divided by 5?

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  • Why were the Halliwells partners stuck with Brown Street ??
    Because they had taken a reverse premium from the landlords .
    One guess what they did with it.

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  • What's the prospect of his being made bankrupt? I am not sure how the SRA view this, but it would mean the end for his time as a Trustee at Salford University.

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  • Not true re the g'tees. Alec C and 3 others (not Ian actually) are the named tenants at SJC because the lease dates back to pre LLP days and was never assigned to the LLP, presumably so it didn't show as a liability in the LLP accounts, it certainly wasn't an oversight. Makes the furore about 'assuming they would be released on leaving the LLP' all the more laughable, particularly as one of those who is objecting holds himself out as a property lawyer.

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  • So let us see what the maths actually looks like for some of the full members;
    Ian has helpfully indicated that he put in £700k. We may therefore be able to assume his capital account stood at that figure as with others on presumed maximum points and including the various cash calls. For the guarantors of SJC there appears to be a quarter of £3.5m ie £875k. It is already clear from the reported actions of Paul Thomas that he at least is not convinced the other members will be rushing to pick up their share of that figure.
    Can we also add claims for £20k by all the FSMs if there was any misprepresentation on the cash call and what about the tax?
    Can we also add claims by the admiinistrator for return of any recent distributions including the reverse premium?
    Were the full members taking out funds whilst the firm was trading at a loss and sinking under an ever increasing mountain of debt that it could not satisfy?
    Questions questions.

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  • And to the amounts above should be added those monies derived from activities associated with clients of Halliwells and personally pocketted by those at the top of the points. Non-executive fees, arrangement fees and investment returns many of which were not expressly sanctioned by , or indeed disclosed to , the partnership. Doing property or corporate transactions with Manc clients could be a little like tripping unawares through a minefield as one confronted the ordnance of undisclosed senior-partnerial interests. Halliwells was not like other large law firms in this regard and it is one area where this magazine's reporting has been deficient. Newcomers from large and small firm alike were constantly surprised by the lack of control over these "entrepreneurial" habits.

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  • It seems the partners all resigned from the llp on an hours notice leaving Paul Thomas and the other guarantors to take the pain. It seems the argument goes like this. If you are not a partner the guarantors can't seek a contribution. The guarantors ironically took the largest shares of the reverse premium so there is a bit of poetic justice to this. That having been said it displays the calibre of the people involved in this. Partnership and friendship means nothing to them. They ought to be ashamed of themselves but I doubt they have even given it a second thought.

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