Accident Lawyers

Lawyers need to redraw ethical boundaries “or face external action”

The legal profession is “drawing the ethical boundaries in the wrong place” in its dealings with corrupt kleptocrats and oligarchs, and risks having reforms imposed on it as a result, a leading campaigner has warned.

Meanwhile, the woman who first broke a Harvey Weinstein non-disclosure agreement has called for legal regulators to be given more power.

Speaking at yesterday’s Legal Services Board conference in London, Robert Barrington, professor of anti-corruption practice at Sussex University, talked about how some lawyers helped make London a “clearing house” for dirty money through working for kleptocrats, their families and their businesses.

He explained how anti-corruption campaigners have realised that, even if anti-money laundering (AML) laws were being well implemented, “which they’re not”, there was “seldom a criminal offence that is provable to the degree necessary in English courts” against lawyers.

“So the fundamental principles of dealing with this through a legislative/AML approach don’t work. We’ve got a situation where London law firms are acting for corrupt oligarchs entirely within the law.

“That perpetuates the corruption in the country of origin and it discredits the UK. It’s not in the public interest and it seems to put the interest of the clients above the public interest. And because there’s no provably criminal conduct, the challenge is essentially an ethical one – with practical implications.”

The ethical principle was ‘Should I act for corrupt oligarchs and kleptocrats?’, he said. The practical implication was ‘How do I know who is corrupt?’

Professor Barrington – former head of Transparency International in the UK – continued: “Currently, the legal profession is drawing the ethical boundaries in the wrong place, in that more or less anything goes.

“That diminishes the profession, which society needs to be in good standing at a time when the independence of the judiciary and the rule of law are being challenged by politicians. It diminishes the law firms involved, though some of them don’t seem to mind that. It also diminishes the UK in the eyes of key international partners.”

The first step, he said, was to accept there was a problem, but “even that seems extremely hard for the legal profession to do”.

“I have to say that the Law Society has not distinguished itself in its own approach to this. Standard arguments are rolled out around access to justice, the right to representation and innocent until proven guilty – all of which have merit in certain circumstances but certainly should not be applied in a blanket way to this issue.”

He warned that, “if the profession doesn’t change itself, it’s more likely to have change forced on it”.

Session chair Professor Richard Moorhead of Exeter University, the leading academic on lawyers’ ethics, noted “how quickly the big firms got the reputational point” in relation to Russian clients after the Ukraine war and “started to panic and shed clients”.

It was this, and “not the ethical or public interest point” which prompted them to act, he argued.

Zelda Perkins was Weinstein’s personal assistant and signed an NDA to settle her claim against him and his film company Miramax in 1998. She broke it in 2017 to speak out about what she had faced. Last year, she co-founded pressure group Can’t Buy My Silence.

She told the session, entitled ‘Trust and ethics: Has the legal sector lost its way?’, that “what really broke me” was the lack of access to justice she had back in 1998.

“The problem started the moment I was in a room with a lawyer. I thought that I was going somewhere I was going to receive help. I was disavowed of that almost immediately.”

She was not necessarily saying she was given bad advice, “but the advice I was given was driven by the fact that regulation and legislation doesn’t support the legal profession to make ethically strong decisions”.

Little has changed since except for whistleblowing laws, she went on. “The SRA [Solicitors Regulation Authority] has tried to put out warning notices. As far as I’m concerned as a lay person, a warning notice is a conversation. It concerns lawyers at the moment it’s there but in another few days, weeks or years that warning notice is ignored.”

The SRA tried to take disciplinary action against Weinstein’s lawyer for the NDA but the case was stayed due to the solicitor’s health.

Ms Perkins said: “The SRA has tried but… from what I’m seeing the regulators don’t have enough power… To me the only way this is going to improve is by lawyers being supported by regulation to make the right decisions and by legislation changing.”

The session was told that too often lawyers did not consider the public interest, with former general counsel Jenifer Swallow saying in-house lawyers were under pressure to act solely in their employers’ interests – she recently published a template contract amendment letter they could use to write their regulatory responsibilities into their employment contracts.

Some in-house counsel’s focus was on being a businessperson first and a lawyer second, when it should be the other way round, she added.

Jeremy Barton, general counsel at Big Four accountants KPMG, agreed that “the legal profession perhaps is so focused on the here and now that it loses sight of the public interest element of the role”.

He said private practice could also have independence problems, if they were reliant on general counsel for work, for example.

“Where lawyers are being paid and their advice is being given to those who are paying them, how do you make sure that the lawyers are doing the right thing in the moment?” he asked.

“At that moment the right thing might be fighting the corner for your client but it might be to say ‘Stop’. What happens when the lawyer says stop and how do you support them when that’s needed?”

He explained that KPMG’s approach was to put in place frameworks to “enable ethical decision-making”.

Professor Moorhead listed several leading law firms, in-house teams and barristers that had found themselves in difficult ethical situations in recent years, with major issues like the Post Office Horizon scandal raising difficult questions.

“I’m told regularly [by in-house lawyers] that even or perhaps especially leading firms – with one or two honourable exceptions – do not take ethics sufficiently seriously,” he said.

“I have heard a leading COLP mis-state ethical priorities as client first and another leading partner who used to advise the SRA regularly celebrate his and his partners’ ignorance of the code of conduct.

“I have listened to sometimes toe-curling and heart-breaking stories from in-house lawyers either slipping into or pressured into ethical lapses of sometimes profound significance, and ruining their lives and mental health as a consequence.”

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