An accountant who was sentenced to six years in prison for “soliciting to murder” has been ordered to pay costs of £2,240 to the ICAEW for bringing “discredit” on the profession.
At the time of the conviction “Mr A” - who was not named because of ill health of a family member – was a member of ICAEW but, since the institute did not see the press coverage of the conviction he was allowed to resign his membership in October 2002.
Mr A said the reason for resigning his membership was that he was going abroad and did not intend to continue in practice. He finally reported his criminal conviction to the institute in June 2003, two months before he was released from prison, the ICAEW’s disciplinary committee heard.
Mr A was released from prison in August 2003. In 2006 he applied to be readmitted as a member of the institute. This was refused but in 2011 his request for approved.
When sentencing Mr A the institute’s tribunal took into account the “exceptional circumstances” of the case, the passage of time and evidence of the member’s rehabilitation and that he had been readmitted to membership. The tribunal decided to impose no sanction other than a fine.
The case was one of the disciplinary rulings published by the ICAEW earlier in June.
In a separate case, accountant David Arthur Rice was “severely reprimanded” for improperly retaining a payment of £2,937 from a client of a chartered accountant, Thomas Westcott Partnership (TW), whom he worked for until June 2010.
Rice was also reprimanded for failing to make £21,474 of pension payments for employees between 2005 and 2008, the tribunal heard.
Retained payment
In March 2010, Rice attended the annual general meeting of Ivybridge Constitutional Club, on behalf of TW in his role as client partner. During the AGM Rice was given a cheque for £2,937.50 – payment of an invoice for TW’s accountancy services.
There was a dispute over whether Rice had asked the treasurer of the club to make the cheque payable to his name. Rice denied doing so.
Rice told the tribunal that he mistakenly paid the cheque into his personal account. The club confirmed that the cheque cleared its account on 24 March 2010.
There was a dispute over whether Rice had seen the April and May debtor statements for the club, the tribunal heard. The statements showed that, so far as TW was concerned, its invoice remained unpaid.
The tribunal said it did not find credible Rice’s claim that he had not seen the April and May statements. Rice routinely reviewed clients’ statements sent to one of TW’s offices, the tribunal noted.
Richard Thomas, the senior partner of TW, called the police, his lawyers and contacted the ICAEW. Thomas asked Rice to repay the cheque from the club.
Rice told the tribunal that he could not obtain the bank account details for TW, saying that there were withheld from him on the instructions of Thomas. However, the tribunal noted that the bank account details were included on PW’s client statements.
Due to financial difficulties, Rice said he had had to start the process of entering into an individual voluntary arrangement (IVA). In August 2010, he was advised by his supervisor that he ought not to repay the sum owed to TW. It was paid in February 2011.
Pension payment
The second complaint against Rice was about his failure to make payments towards employees’ pensions.
David Rice & Company was obliged to pay 5% of employees’ salaries towards a stakeholders pension by 31 October following the end of the accounting year, under employment contracts.
In March 2009 TW acquired the goodwill and assets of David Rice & Co. Rice signed an agreement with TW, which included warranties relating to employee pension contributions due by his firm, the tribunal heard.
He said that he told his employees that although he intended to make their pension payments from the capital from the sale of his former firm to TW the payments would be delayed due to financial difficulties.
Rice said that the partners of David Rice & Co continued to take drawings from the firm during the period that employees’ pension payments were in arrears.
Compensation is still owed to one former employee and Rice gave an undertaking to the tribunal that he would write to her to make the payment.
Rice said that he had not told Thomas that pension payments were outstanding when he negotiated the merger with TW.
Rice said that he thought that under the terms of the merger agreement in March 2009 that TW would not have to make pension payments for employees of the former firm, David Rice & Co.
The tribunal concluded that Rice’s failure not to have repaid the club fees earlier was conduct had been “unacceptable” and below the standards expected of a chartered accountant.
On the second complaint, the tribunal ruled that that Rice’s failure to disclose employees’ outstanding pension contributions had been deliberate.
The tribunal decided to impose a “severe reprimand” on Rice, but no fine or costs, reflecting his commitments to paying the money owed to TW and the outstanding pension contributions to one former employee.
