Marrache London hits out after Gibraltar partners charged with false accounting
A partner in the London office of Marrache & Co has reacted angrily to news that the firm’s Gibraltar-based founding partners have had their Financial Services Commission (FSC) licenses cancelled, claiming the City base’s reputation is suffering by association.
Benjamin Marrache
Founding partners Benjamin and Solomon Marrache were arrested on Tuesday and charged with falsely accounting €1.8m (£1.58m) of client money. They spent the night in police cells before appearing in Gibraltar Magistrates Court on Wednesday, when they were granted bail at £300,000 each.
The court also required the brothers to pledge £150,000 each, as a recognisance, to hand in their travel documents and report to police twice a week. The case has been adjourned until April.
Steven Daultrey, a partner in Marrache & Co’s London office, which is linked to Gibraltar only through the brand, said he felt “anger, rage and incandescence at certain names working in the firm’s Gibraltar office”.
“I have an office here with people whose livelihoods I have to consider,” he said. “I’m utterly speechless. The Gibraltar firm has nothing to do with the London office; [Benjamin and Solomon Marrache] aren’t signatories here. We do English-law work only.
“I’m concerned for the London office clients too, but at the moment those clients have been nothing but 1,000 per cent supportive. We haven’t had one client complain, they’re saying they’ll do anything to help. They receive a good level of advice here but, in terms of reputation, the situation is awful.”
The Marrache brothers are alleged to have falsified documents to hide €1.8m of missing money belonging to shipping company Portino Comercio Internacional.
Gibraltar’s FSC cancelled nine licenses held by Marrache & Co, which also has offices in London, Spain, Lisbon, Prague and Luxembourg.
According to a statement issued by the FSC the decision to cancel the brothers’ licenses was taken “following an investigation into the affairs of the licensed entities and persons which in the opinion of the Commission have disclosed serious and persistent breaches of Gibraltar’s financial services legislation”.
The Lawyer was unable to reach anyone at Marrach & Co’s Gibraltar office, which is understood to be under police guard, but Benjamin Marrache was quoted in the Gibraltar press as saying: “We intend to appeal the decision of the FSC. If there are any issues involving any of these companies these will be resolved.”
The firm’s Spain, Lisbon, Prague and Luxembourg offices are understood to be linked to the firm by name only.
Frederick White, managing director of Grant Thornton, has been appointed by the FSC as authorised administrator for the firm, in which capacity he will help clients of the Gibraltar office transfer their business to other licensed entities.
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Readers' comments (37)
Christian | 25-Feb-2010 11:24 am
CityGent:
I am a Gibraltarian and you have just illustrated to everyone that you don't know anything about Gibraltar, that you are ignorant to the situation and that you come from somewhere where the sun doesn't shine very much! So if you have nothing constructive say, don't bother saying anything. We work hard and honestly in our country... our reputation is on the line without ignorant people generalising, like you.
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Anonymous | 25-Feb-2010 6:16 pm
This situation is most unfair for Gibraltar who boast some superb, world class law firms such as Isola and Isola and Hassans who are as good as any of the Magic Circle firms with the highest standards of client care and integrity. Never before has a Gibraltar law firm been involved in such serious allegations let alone denied bail and locked up. However it happens regularly in the UK. Solicitors are going down like 9-pins, the Fraud Dept of the SRA has never been busier, solicitors are being struck off regularly and rotten firms should down all over the UK. In which case solictors in England should be the equivaelent of a cesspit in the depths of hell by association with the hoards of lawyers currently under investigation by the SRA or already struck off, awaiting trial or already in prison. Poor little Gibraltar.....it only needs to happen there once and the entire place suffers by association. In fact Gibraltar professionals are amongst the best in the world, their Government is exceptional and could teach the louts at Westminster a thing or two (and I include the excellent opposition in this comment) and the people are winderful, it is aplace where Muslims, Christians, Jews, Catholics et al exist in harmony. Gibraltar could teach the world a thing or two. They have been going a long time and one bad firm should never effact the reputation of any legal juristiction....otherwise the UK would be a total no-go area by way of comparison.
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Anonymous | 26-Feb-2010 2:27 pm
Clients monies in Gibraltar to do benefit from the same protection as clinets money in the UK. I deposited in good faith circa 12,000 euro to Marrache & Co's client account for a legal completion. I am now being pursued for breach of contract & It appears that I have lost my money. Some poor people may have lost their life savings. There is no help or support from the Gibraltar Government. They need to act quickly and offer real support and assuarances that clients money remains clients money and is protected.
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interestedpartly | 27-Feb-2010 10:08 am
Is the entire firm now in liquidation, including the London office? The comments of the London Partner at the top of this article suggest that Marrache & Co in London are looking to remain operational. But 2 weeks later this appears not to be the case?
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Anonymous | 2-Mar-2010 9:08 pm
Ask any auditor in gibraltar and you will invariably discover manipulation of client accounts is indeed rife amongst both lawyers ,accountants and indeed estate agents as well.
For example , at one point in the past a certain legal practicioner deemed it appropriate to help himself to client funds whilst under the employment of another gib based law firm .
Certain staff members within one of the firms on the rock also found themselves helping themselves to client account funds without the clients prior approval-consent .Everyone in Gibraltar knows about this particular event that took place not too long ago.
What Gibraltar needs is an independant audit by UK accountants of all law and accountancy firms here in gib over the last decade or so .Without doubt , false accounting would be discovered on a grand scale .
The Rock Of Gibraltar is not as squeeky clean as it likes to portray itself to the world media , it is littered with deceptive and greedy so called professionals who think , because of their professional standing , that the laws of the rock are only applicable to the working masses , but not them .It has been like this for many years .
Ask yourself this question , out of the thousands of companies registered here , how many of those companies are involved in tax evasion and money laundering .
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Chris Johnson | 4-Mar-2010 5:38 pm
It amuses me how many people commenting on this article are content to cast aspersions on Gibraltar and its professionals, but don't have sufficient courage of their convictions to publish their own names - how credible does an "Anonymous" byline make their comments?
Like any financial centre Gibraltar has its black sheep, but the vigilance of the Financial Services Commission and the Police Financial Crime Investigation Unit, allied with legislation including all crimes money-laundering legislation, which many so-called mainstream European territories don't have yet, mean that clients would be hard-pressed to find a more robust regime in which to confide. In this case it took the FSC less than 5 working days to act, once they had indications of apparent malfeasance on the part of the Marrache brothers.
The Marrache case is not yet proved, 'tis true, and a long path is to be gone down before the full facts will be known, but those who use this incident to seek to attack Gibraltar as a jurisdiction, or even the rest of the legal profession here, are barking well up the wrong tree!!
My thoughts are with the Marrache staff; I know unions are stepping in to assist them, and I hope their situations will be resolved.
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Horace Partington | 18-Mar-2010 2:49 pm
The words "City" and "gent" together are a tautology.
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