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What the Bloody Hell Should I Do ?

What the Bloody Hell Should I Do ?

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I had a Client in 2013, who had set up a Health Bar in a local gymn (sub-letting). He commenced the business in November 2012 and contacted me in January 2013.

I conducted an interview and we were instructed to produce taxation accounts; but given the timing (Mid January and tax year end) ; he was advised that we would have a look at his books in February. BUT. The person from whom he was sub letting is known to this practice; and has a very poor business profile. I cautioned the client against making significant investments.

We picked up his books in February and he had made very significant investment. We were drawing his accounts to 5th April (he had a trading loss, so I was doing accounts from Nov 12  to 5/4/13 to re-claim employed tax paid in the 12/13 tax year. 

Long story short, the business (in it's current form), ceased on the 5/4/13. The bailiffs (so I believe) moved into the gymn and my client had a few hours to move his own property. Which he did.He managed to get his stuff out to his Parents' premises.

I was then advised that the Client was seeking new premises; to set up a new Health Bar, but in the interim, freelancing as a consultant/waiter/food preparation....

So prepared the Accounts  to 5/4/13 that showed a loss. As the business was not trading at that point; I invoiced the fees; ((July 2013) and requested payment.We both Emailed and posted our invoice.

The Client required clarification as to my fees. I explained that they were applied as a deduction against his accounts; save for that proportion that related to Taxation services. He then required clarification re Depreciation/Capital Allowances; and I explained that at length as well. 

In the interim the Client gave up "Self-Employment" and took a job.

The Client could not pay, so his Dad paid them; and I spoke to the Dad and he required clarification re our bank details, so he could pay electronically.I gave him those details.

I showed my full fees on the Accounts. The Client Signed the Accounts on the 24/1/14. I had pre-prepared the tax return; and amended it in front of the client having reviewed it. His business bank account had been closed, and I amended it for this detail; and he also advised that he had a civil partnership and was still married; not yet divorced. All amendments were undertaken, Client signed and then...... as we were just generally chatting and closing. He said that his ex Husband had put all the money into the business.... and it was a very acrimonious divorce and the ex husband wanted his money back........ 

So I said. If that's the case.... it perhaps should be dealt with as a partnership; and the loss ( and tax refund), wasn't necessarily his alone. I was waved away and told "let the solicitors sort that out".

Just in further chat; I was advised that his self employment since the health Bar was evicted and up to and including his employment, was with one single trader.; basically employed without the hassle So I said... That's not on. You need to tell me specifically what has happened with the assets of the trade; because the refund will need to be repaid in part, potentially; as AIA have been claimed; and there is essentially a cessation of trade.

In May 2014 he wrote an email saying he had moved back with his parents (approx 80 miles away) and had decided to move accountants. I submitted my final bill.

And then it began.

The Client has made a police report for fraud.

A policeman came to my house on Saturday; and I was asked to come to the Police Station yesterday to give a statement under caution.

The Client asserts that I told him that my fee note was advised by me as a  payment to the tax office." He has checked with the tax office; and the monies have never been paid.to the tax office".

I went in on Sunday; had to be cautioned; and then had to give a recorded statement

The Police man was very apologetic.

Disclosed my file etc.

I showed my fee notes

Showed the Accounts (signed by client) showing fees as per the Fee Notes

Showed the Tax Comp/Tax Return (signed per Client). In line with accounts/Tax Comp.

The Policeman said that there was obviously no crime; and no further action would be taken; but a crime having been reported, I then had to present under caution.

I am so so sorry that this is so long. 

I am just completed devastated  and humiliated.

Replies (29)

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By JSK
19th Jan 2015 21:02

You are not the wrong

Anyone in your situation would not be any different to you. It cannot be easy. 

From what you have said you are not the wrong. The client is for wasting Police time. 

Best you contact your Prof body. Though my experience with them is they are not much help. Worth a try. 

Also contact a solicitor asap. May be your indeminity insurance would cover the cost. 

It had to happen at the most depressing time of the year. 

 

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By Gmb
19th Jan 2015 21:28

Thank you JSK. I am really down in my boots.

I contacted my Indemnity Insurance solicitor when he made the threat, way back in July 2014. (to contact the Police). They said there was nothing they could do, as it was a "Civil Right" and they could not stop it.

He also threatened to contact Trading Standard; but I haven't heard from them yet.

I was told "off record" by the Police  that it should have never have been booked as a crime report and there was obviously no question to answer; I was also advised to "Dump him right in it with the tax". I can't ask for a "wasting police time " report. They decide this alone.

The Client has also (according to the police); reported my "crime" to HMRC.

I've been in practice 27 years and have an absolutely sterling  record with HMRC.

I don't know whether to contact them and give my side of the story; but it goes entirely against the grain. He's withdrawn his 64-8; and I would indeed be doing it for an element of vengeance.

But; when the Policeman turned up on Saturday, I immediately thought that something had happened to my very elderly parents. I can't get the fear I felt at that moment, out of body.

 

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By duncanedwards
21st Jan 2015 13:52

Scum!

Gmb wrote:

I was also advised to "Dump him right in it with the tax".

 

What an absolute verminous piece of scum your ex-client is.  Hope he gets his comeuppance sometime very soon.  Sooner or later he'll do something similar to someone who isn't a professional person and will come off a lot the worse for it.

If there was the slightest reason to drop him in it with anyone, I personally would take it but the sensible thing is probably just to try and give it no further thought.

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By Tosie
19th Jan 2015 22:09

Coming to terms with it.

You have had  a terrible experience but it is now over. The police have assured you that no action will be taken and there is no stain on your character.

To seek revenge is what I am sure you want to do but you will get nowhere and he will lie and lie and cause you more grief.Obviously he should be charged with wasting police time but it does not look as though that is going to happen.Legal action would be expensive and probably fruitless.

I would avoid prolonging the agony by contacting HMRC you will have to explain to some moran who may think there is no smoke without fire.

I am sure all who know you personally and all members of this site will be rooting for you and tomorrow is a new day.

Good luck.Very sorry that you have had to suffer this ordeal.

 

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By Davy Boy
19th Jan 2015 22:55

Nightmare clients

Get the police to put in writing that no crime has been committed. That will be useful should this ex client decide to try civil proceedings.  It may also be worth getting a solicitor to write to him stating that you consider the making of spurious allegations to the police to be an act of harassment and that by also complaining to HMRC he has done so on two occasions, which constitutes a "course of conduct" as specified in the Protection from Harassment Act. An application can be made in the civil courts under s3 of that Act for a restraining order against him should he continue. Make sure that you have a blow by blow record whilst fresh in your mind as people like him can become obsessive and their resentment can fester for months or years before they try again to cause you grief. 

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By louisVW4
21st Jan 2015 18:36

Make a formal harassment complaint to the Police.

You have clear evidence already with the police that this client has caused you distress. Hence, a case of harassment under the Act. If you don't wish to pursue this in court, ask the police to issue the miscreant with a Harassment Notice.  It will advise him of your complaint, and threaten prosecution if he continues.  It should serve the purpose.

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David Winch
By David Winch
19th Jan 2015 23:52

What you should do now IMHO is NOTHING, other than congratulate yourself on having dealt with a difficult & stressful situation very well.

It sounds to me as if you were not arrested & that you attended the police station as a volunteer to make a statement.  Your statement was made under caution & was recorded but I expect you were not subject to fingerprinting, photographing or the taking of a DNA sample.

You dealt with the situation very well not just from the time the police contacted you, but well before that when you were dealing with the client, putting things in writing, billing him sensibly, getting his signature on the accounts, etc.

Whilst you may say, 'Of course I did all that, it's what any competent professional accountant would do".  But think for a moment what your position would have felt like had you not done these things 'by the book'.

Also, it seems to me, you made the right decision to deal fully, frankly & constructively with the police & to give a statement as a volunteer (& disclose the supporting documents).

It must have been a real ordeal, but now it forms valuable experience should you (or a client) have dealings with the police in future.

You may well hear nothing further from the police.  Since you were not arrested they may not have occasion to write to you to say that the matter has been NFA'd (No Further Action).

Should the matter be raised by HMRC or your professional body (if you are a member of one) or anybody else you can say that the ex-client's complaint has been fully investigated by the police who have decided to take no action against you.

It is most unlikely that the matter will get into your local press or that 'word will get round' locally about this as the ex-client has now moved away.

The chances of the police taking any action against the complainant are absolute zero IMHO. Just forget that.  Put the episode behind you.

In short, rather than feeling devastated & humiliated, you should feel vindicated & victorious.  It is the ex-client who should be feeling devastated & humiliated.

Congratulations!

David

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By BKD
20th Jan 2015 07:53

Much more sensible advice, David

Thanks for restoring senses to the discussion.

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By Gmb
20th Jan 2015 09:15

Many Thanks David; I will be taking your advise.

I have already had an 8 am meeting and ticked another case of the list. Only 8 more to do now  in 12 days !

I will be focusing all of my energy on the job in hand. Thank you all for your support, it is very much appreciated.

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By andy.partridge
20th Jan 2015 09:56

Reward yourself

Book yourself a holiday. You have earned one. Apart from that, there is nothing more to do. Unfortunately not everyone we meet in this business is a nice person. Fortunately most are and it is quite likely that you will not experience anything like this again in your career.

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David Winch
By David Winch
20th Jan 2015 11:03

One suggestion (for next time!)

I think you might have found it less stressful if you had consulted a criminal solicitor before going to the police station & taken him along with you.

Venturing into a police station alone when you are (however unfairly) a 'suspect' must feel like a Christian entering the arena to face the lions!  Having someone with you who is on your side must help.

Also the solicitor will know the patterns of behaviour to expect - in the same way as you probably know what to expect when a client is invited for an interview with HMRC.  In all probability the solicitor would have said not a word during your recorded interview - but that's not the point.

I think you chose a route which was harder than it might have been by going in alone.

(This comment is really for the next accountant who finds himself in a similar situation.)

David

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By Stuart.thomson
21st Jan 2015 11:50

What a story!
I feel for you. It's over and you've done nothing wrong. As soneone said its a learning experience. In years to come you may smile at the ridiculous events and possibly break ice with a new client over it.

However I think you need to consider SOCA especially if the new tax accountant has not contacted you for the history? If that's not appropriate document why.

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7om
By Tom 7000
21st Jan 2015 11:55

You know what...

Its really interesting going to police stations....when you havent done anything wrong

Look on it as an adventure.

 

I imagine its really horrid going there if you are a bad lad

 

Now finish off your january tax returns... :)

 

 

 

 

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By Michael C Feltham
21st Jan 2015 11:59

Best Advice:

David Winch's advice (last post) is spot on.

If accused by the police authority, before you leave your home/office, demand to firstly consult a solicitor specialising in criminal law.

NEVER EVER set foot inside a cop shop, without a solicitor!

Offer to report once the solicitor is available In which case, I doubt you would have received a caution.

Personally, once Jan 31st is out of the way, I would indeed consult a solicitor and take considered advice on pursuing this clown for false witness, defamation (Libel and or Slander has occurred)  and attendant costs. Ruin his February, March and April!

Always remember, whilst the police close ranks and the DPS etc are mainly disinterested in pursuing idiots who waste police time, lay false witness etc, nothing prevents a citizen from mounting a private prosecution, under both civil and criminal law.

 

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David Winch
By David Winch
21st Jan 2015 12:31

Under caution v a caution

I do not think the OP received a caution.  A caution in that sense refers to a formal procedure in lieu of prosecution where a suspect has admitted that he is guilty of a (minor) offence.  So if the OP had been involved in a pub brawl on a Saturday night he might receive (and accept) a caution for that instead of going before the Magistrates.

What I believe happened here is that at the commencement of his recorded interview the police officer informed him that he was not obliged to say anything but that . . .

It's a different thing altogether.

David

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By Michael C Feltham
22nd Jan 2015 12:57

Caution over those cautions!

davidwinch wrote:

I do not think the OP received a caution.  A caution in that sense refers to a formal procedure in lieu of prosecution where a suspect has admitted that he is guilty of a (minor) offence.  So if the OP had been involved in a pub brawl on a Saturday night he might receive (and accept) a caution for that instead of going before the Magistrates.

What I believe happened here is that at the commencement of his recorded interview the police officer informed him that he was not obliged to say anything but that . . .

It's a different thing altogether.

David

 

David

The mere fact a person is "Cautioned" means Plod suspect he/she is a miscreant and intends/hopes to prove it.

Witnesses visiting a police station are not cautioned: why ought they to be?

For example, if HMRC visit a taxpayer/VAT registered trader etc, in pursuit of enquiries, then at first their position is crystal clear. They must determine whether they believe the interviewee is a potential Civil Matter, or Criminal Matter. If the second, then the statutory caution must always be given. Same with investigating officers of DWP chasing benefit fraud (criminal matter).

As soon as any officially empowered officer of HM Government starts the magic phrase "I must caution you and warn............etc", is the time to glue the lips together and demand the right to silence and the right to a solicitor.

Police Officers today increasingly suffer an attitude problem and decreasing intellect and their collective knowledge of law seems to diminish each week...........

Hardly surprising, really, when, as a chum of many years "On the job" expressed his urgent desire to retire as the concept, at 50 years of age, of rolling around in the gutter in the town centre, amongst the empty beer cans, vomit and takeaway wrapprers at 3.00 AM with drunken skinheads, was not, shall we say, his heart's desire!

 

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By enanen
21st Jan 2015 12:32

Honesty

You appear to have had a dishonest client who has been dishonest with everyone. It is no reflection of you or your work. Chin up and do not waste further monies on this as it will go nowhere. It is just the worst example of someone trying to avoid paying a fee after work has been completed. Scum basically. We all get them. Your client is also probably a bit nuts and irrational due to their personal domestic situation but does not forgive their actions.

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David Winch
By David Winch
21st Jan 2015 12:37

SOCA / NCA report

I cannot see any basis here for a report to the NCA (formerly SOCA) under MLR 2007 / s330 PoCA 2002.

The former client is involved in a divorce, the business has ceased and a fresh accountant has been instructed.

On what basis would the OP have a suspicion that money laundering has occurred?

David

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By Thaya10
21st Jan 2015 16:56

BE FIRM WITH FEES

 I AM REALLY SORRY TO HEAR THIS. YOUR CLIENT MAY BE DOING THIS TO AVOID PAYING YOU. IN THESE CIRCUMSTANCES I WOULD TAKE COUNTY COURT ACTION TO RECOVER MY FEES. IF I LET THIS GO HE WILL DO THE SAME TO OTHER ACCOUNTANTS. DON'T LET HIM GET AWAY WITH YOUR FEES. TRY NO WIN NO FEE FIRM AND YOU MAY BE ABLE TO SUE HIM FOR YOUR LOSS OF TIME ETC.

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By PhilipJG
22nd Jan 2015 13:13

New accountants

Did the new accountants contact you for professional clearance?

If yes, what did you tell them?

If no I would complain to their professional body.

If they don't have one then ignore this post!

 

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David Winch
By David Winch
22nd Jan 2015 13:29

Interview under caution

Of course the OP was a 'suspect' not merely a witness.  An allegation of fraud had been made against him.

As a 'suspect' being interviewed the interview was recorded and he was cautioned before being questioned.

I have already said that IMHO he would have been wiser to have taken the advice of a solicitor before speaking.

But in this situation the 'suspect' was not only denying the allegation, he had a full & honest explanation and was in possession of supporting documents.  He apparently had sufficient information about the complainant's allegation & the evidence held by the police.  He had had time before the interview to give the matter careful thought & to refresh his memory from his files.  The matter was not inherently particularly complex (as some alleged frauds can be) nor was he likely to be asked about details of transactions a long time ago.  He very much wanted to tell the police his account of what had happened.

In these circumstances I do not think that a solicitor would have advised the OP to remain silent (or go 'no comment') in interview.

In other circumstances a DP (a detained person in a police station, i.e. one who has been arrested) may well be advised to go 'no comment' in police interview - even where the DP claims to be (and indeed is) innocent of the alleged offence.

David

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By Gmb
23rd Jan 2015 20:59

I am female by the way.

I am even more terrified now, by my lack of caution/experience.

I was caught very very much off gaurde.

The policeman arrived mid-afternoon Saturday, at my home.

 I was just about to go in the shower and was wearing a frumpy dressing gown and my hair/face looked like it had been dragged through a hedge twice. To compound my unease Daughter is in the middle of her mocks; she's trashed the sitting room in the 15 min I'd left her unattended, closed all the curtains so it looked like a cave.

Husband had not even unpacked the Waitrose shopping properly (jar of coffee by the front door since 8.30am); or the empty box for a 3.2 m garden parasol. The house looked like a tip.

Suffice it to say, I was not at my best and felt very vulnerable.

And thought my Parents were dead. 

I couldn't breath when he introduced himself and asked if he could speak to me alone;; and dismissed my family.......

I only caught the gist of it. Come to the police station tomorrow. Make a statement tomorrow. It will be recorded; but it's just a formality..there's no case to answer. It was recorded in another police district; they've assigned a crime number; we've reviewed it; and there is no case to answer.It's just a formality.

So I did. 

|But I was so stunned  I  simply could not make it out of bed until an hour before the designated  interview (to shower and change). I hadn't slept all night

I normally rise at 4.30 am; and my appointment at the police station was at 3.30pm  -4.15pm.

I couldn't get out of bed.

I lost a day's work because It was just like I'd been given an electric shock. I couldn't function.

I grabbed the client file out of the office (next door) and just gave a police statement that was recorded.

And now I think I have been very very stupid for not taking my paid for, for 27 years, solicitor under my Professional Indemnity insurance.

 

And it DID feel like a Christian being fed to the Lions walking into the Police Station.

And I haven't stopped worrying about it since. I am terrified that I am going to be arrested..

I am keeping going with my work; but it's tough.

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By qad999
23rd Jan 2015 22:50

time heals

Its probably still quite hard to come to terms with . In time you will probably see this as invaluable experience and it will give you a huge amount of confidence in yourself, your honesty  and your ability

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By Gmb
23rd Jan 2015 23:01

As long as I am not actually arrested. Then that's my whole career and reputation out the window. Trial by local press.

I have a huge amount of experience and thought I had seen it all. Apparently not.

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By Gmb
23rd Jan 2015 23:09

The statement was recorded on a machine. I didn't get any transcript or a copy of the recording.

I have put a date file on for the 1/2/2015 to contact the police officer (that will be a fortnight); and ask for an update. If I'm not happy with the response, I will contact my Prof Indemnity on Monday 2/2/2015.

Like most of us, I've been working like the clappers to hit the 31st. That has kept my working day/evening/night focused; but I am finding that I just cannot switch off and sleep. I am just so worried.

 

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By andy.partridge
24th Jan 2015 09:44

Good news

Gmb wrote:

The statement was recorded on a machine. I didn't get any transcript or a copy of the recording.

You would get a copy if you were being prosecuted, so that's good news at least.

If the feeling you have over all this doesn't start to dissipate soon I think you should see your GP.

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David Winch
By David Winch
24th Jan 2015 09:49

Try to put it out of your mind

You are not at risk of being arrested. If you were going to be arrested it would have happened as soon as you arrived at the police station.

Even if you had been arrested that would not normally appear in the local press. It is only in the case of celebrities or major crimes that the press are notified of an arrest.

An arrest would now only be necessary if the police decided to search your home or office for evidence - but you have already volunteered the relevant documents - or if the police wanted to interview you again & you refused to attend - but you wouldn't refuse.

The interview probably has not been transcribed & very possibly never will be.  (Why should the police spend the time & effort to transcribe the 'tape' if the case is clearly destined for NFA?)

You can obtain a copy of the 'tape' (actually a disc) & I would suggest that you do obtain this & then put it in a safe place out of sight.  I would recommend that you do NOT listen to it.  If you do you will only criticise yourself for bits that you said or didn't say.  That would be a painful & entirely useless exercise.

It's a traumatic experience but it's over. I'm sure you have the support of your family & you know you have done nothing wrong.

David

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By ShirleyM
24th Jan 2015 11:19

Don't get upset ... you should feel on top of the world

You have been vindicated and shown not to be the pathetic excuse for a human being like the person who caused you all this trouble.

I would feel sorry for them, that their life and sentiments are so shallow that they would rather do harm than good.

Hopefully, the police gave them a good dressing down for wasting police time. :)

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Morph
By kevinringer
10th Feb 2015 16:51

@GMB

Awful ordeal. Are you feeling any better? It could happen to any of us.

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