The SRA has shut down Follett Stock with immediate effect following revelations that the Truro-headquartered firm was facing a HM Revenue and Customs winding up petition last month.
The SRA has declared Follett Stock and its holding company Follett Stock Holdings Company insolvent, stating that an intervention was necessary to protect the interests of clients of the firm.
The Cornish firm, which has been prevented from operating, has been told to hand over all documents and papers including client’s papers as well as all money held at the firm.
The SRA has appointed an agent to deal with all the cases and assets on Follett Stock’s books, taking up the most urgent matters first.
The news comes weeks after the firm’s latest court hearing, when it faced winding up application from HMRC over unpaid tax bills. The firm was originally served with the order in August and given until 30 September to settle the bill (26 September 2013).
Follett Stock persuaded the tax to push the deadline back to 21 October when the case went before senior High Court insolvency official registrar Clive Jones. By that point the firm’s Exeter and Bristol offices had both closed and all of the firm’s four offices have now shut their doors (29 October 2013).
Jones had agreed that the case could be adjourned and would be referred to a High Court judge but the SRA has now stepped in to wrap up the firm.
The firm changed its directors from Christopher Lingard and Martin Pearse over the summer to Lingard’s wife, Fiona Higgins and former managing partner Christopher Lingard’s title was changed to ‘lead litigator’. But today the SRA said it was intervening into the practices of Martin Pearse and Christopher Lingard at Follett Stock LLP and FSHL Limited.
The SRA statement said: ”An intervention was necessary to exercise the powers of intervention in order to protect the interests of clients (or former or potential clients), or the interests of the beneficiaries of any trust of which Mr Pearse, Mr Lingard, Follett Stock LLP and FSHL Limited are or were a trustee.”
Director of client protection Helen Herniman said: “In cases like these were the firm has become insolvent, we only intervene once all other options have been exhausted. We have had to intervene on this occasion as there was a clear risk to clients’ interests caused by the firm’s financial difficulties.”