Slaughters slammed for 'club mentality' fee approach in Hellas administration

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  • There should be some mechanism for challenging these fees as it is always unsecured trade creditors at the bottom of the heap that lose out.

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  • "there was no documentation confirming the instruction, or written evidence of agreement over the terms of the retainer."

    Umm... Does anyone from the SRA read these pages?! Not sure one should be billing £2.32m without an engagement letter!

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  • This is just another example of how most professionals involved in insolvency work entirely in their own interest with the creditors merely an inconvenient nuisance.

    One only has to look at a typical statement of affairs to find typists being charged out at £120 per hour. How often do the costs of the insolvency exactly equal the assets of the company?

    Most insolvency work is grunt work, and there is no justification at all for instructing a magic circle firm to do it. A provincial firm would be glad to do the work at half or less what S&M would charge but the IP would rather give the work to his chum - after all, if there was any money left over it would only go to the creditors who would just waste it making things and employing people.

    Insolvency is a gigantic rip-off, and the only reason the professionals get away with it is that no individual creditor, having already been shafted, is going to throw good money after bad when any reduction obtained in the fees will benefit all the creditors and not just him.

    This weakness is ruthlessly exploited and an urgent remedy is required, possibly by means of an individual `reward' to a creditor who succeeds in obtaining a reduction in the costs - maybe a third of the reduction, for example.

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  • The problem is there is actually no one to answer to or manage the fees to an outcome in an insolvency as the 'client' is in fact a 'zombie'. Thus people like E & Y (or BDO etc.) have no management above them (unless one creditor decides to take it on and what a task) and worse have no duty of care to the 'zombie' client. Thus the too chummy relationship between IP 's and lawyers has arisen - they have to answer to no one. If it was Registrar Cheryl Jones she should probably order it goes to taxation as if the 'zombie' client was a live prudent business/man.

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  • I have been discussing RBS's 'cosy' arrangement with KPMG all day. In the end it will be the small guy that wins through. I don't know how but it will happen one day or we are all stuffed!

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  • Don't fully understand how this will "proceed to trial" if Slaughters/EY succesfully defeated the application? Will be interesting to see the judgment

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  • This is absolutely terrible! I cannot believe Slaughters would behave in such an unprofessional and highly unethical manner. I am taking my £10M book of business immediately from them and giving it to an ethical law firm directly as a result of this. It is a national scandal.

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