ICAEW council member excluded after drunken hit and run

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This month's disciplinary orders features a former ICAEW council member who left a teenager partially paralysed, and the case of a misrepresented director's loan. 

Chris Cope from the Accountants Complaint Services Limited (ANCS) reviews the two cases from September's ICAEW disciplinary orders and provides expert commentary.  

A former ICAEW council member and FCA who left a teenager partially paralysed after a drink-driving hit-and-run incident has been excluded from the ICAEW and ordered to pay £2,500 in costs.

Owen Finn, an ICAEW member since 1981, apologised to the disciplinary tribunal for the road accident that caused a 16-year-old to suffer a multitude of life-changing injuries, including a broken skull, a fractured spine, neurological and cognitive impairments and paralysis down his right side.

Finn, who did not attend the hearing as he is currently in prison after pleading guilty to a series of offences, said the incident was “out of character” and occurred during “a difficult time in his life”.

Finn seriously injured the 16-year-old on his way home from a dinner on 7 October 2016 which he attended as president (the report does not name the Institution). Witnesses at the event reported Finn had consumed a large amount of alcohol and was “almost unable to stand”. Despite being twice over the limit, Finn still got in his car to drive home.

Finn crashed into the back of the 16-year-old, who was cycling home from his work at a local restaurant after 11pm. The collision destroyed the bike and the force sent the teenager into Finn’s windscreen. Finn left the 16-year-old injured on the road and drove more than 130 miles to his mother’s house in Birmingham.

The teenager was found by two members of the public. He was taken to hospital where he would remain for nine months and underwent neurosurgery and the removal of part of his skull.

At first Finn denied his involvement in the crash, but once the 16-year-old’s hair particles were found in the car’s shattered windscreen, he admitted the offence.

On 10 April 2017 at Kingston-upon-Hull Crown Court, Finn was sentenced to three years’ imprisonment. All things considered, the disciplinary aspect seems somewhat of a formality, and the defendant’s solicitors accepted (by letter) that exclusion was the only realistic sanction.

Exclusion ‘appropriate and proportionate sanction’

The tribunal did take into account Finn’s 12 years on the Institute’s council, but following the conviction, the tribunal had no doubt that the offences (regardless of these happening outside a professional capacity) brought discredit on the Institute and the profession.

Unreservedly apologetic, Finn acknowledged before the tribunal that the conviction meant that his position as a member of the Institute was untenable and tendered his resignation. Not in a position to pay a fine or costs, his solicitors submitted that Finn should resign in order to save costs.

But the tribunal said that Finn’s attempt to resign, and thus minimise costs, was misconceived. “The only process for dealing with members who commit offences of this nature is to bring disciplinary proceedings before this tribunal,” the disciplinary report noted.

The IC’s application for costs of £5,274 was reduced to £2,500 to reflect the length of the hearing. The costs ordered were to be paid within a year of Finn’s release from custody.

Chris Cope, solicitor and director of Accountants National Complaint Services Limited comments:

  • A particularly sad but equally an appalling case. Allowing Finn to drive when he had clearly consumed an excessive amount of alcohol reflects badly on Finn’s colleagues, following the dinner.
  • Finn stepped down after 12 years as a Council member, shortly prior to the Crown Court hearing.
  • An interesting feature was the tribunal’s comment that the solicitors’ attempt to avoid disciplinary proceedings by submitting their client’s resignation from membership was misconceived. This is yet another instance of solicitors offering advice in matters in which they neither have knowledge nor experience.
  • If the costs have not been paid within 12 months of Finn’s release from prison (he will serve 18 months), the ICAEW will pursue recovery through the courts.

* * *

When employed by a company that sells mobile phone and tablet cases, Middlesex accountant Peter Cass misrepresented £50,000 in the company’s accounts as a director’s loan when he knew it was not and then failed to explain various amendments.

A High Court judge found that Cass had altered, or procured someone else to alter, the director’s loan ledger by adding £50,000 in order to give a misleading impression of the company’s health.

The tribunal concluded that such behaviour should result in exclusion from the Institute and ordered the defendant to pay costs of £16,000.

The Investigation Committee’s case dates back to 2007 when the company discussed the possibility of a £250,000 investment. The investor advanced £50,000 as a down payment for a percentage of the company’s share capital.

The case picked up again in 2009, when the company secured an investment of £150,000 from two other individuals in return for a 40% share.

As part of the due diligence process, the tribunal heard how Cass, in the position of the company’s finance director, instructed a firm of accountants to prepare amended accounts for the 2007 year-end on the basis that the company had received a £50,000 director’s loan, as opposed to the real intention namely the acquisition of shares. However, no formal investment agreement was ever signed.

The Investigation Committee argued that these changes made the company a more attractive investment and it indicated that the company was a going concern, when in reality it had a balance sheet deficit of £91,411.

Following a dispute between the investor and the company in 2012, the case was taken to the High Court, The case was heard in April and May 2015.

Cass made no fewer than five witness statements. He failed to make reference to the amendments to the £50,000 in these witness statements. However, under cross-examination, Cass accepted that part of his witness statements was not complete.

Cass “knew perfectly well that the most important change to the accounts was the ‘going concern’ statement which depended on the reclassification of the loan”, the High Court judge concluded.

When the Investigation Committee brought the case to the disciplinary tribunal, Cass did not contest the allegations despite not finding the complaints fair or justified. Cass admitted the two complaints in full without challenge because of the “uphill battle” he faced seeking to challenge the findings of a High Court judge and secondly, to save time and costs.

The defendant’s counsel proposed that a severe reprimand would be an appropriate sanction, listing that Cass had expressed regret, co-operated with the investigation and had not made any financial gain.

However, the tribunal questioned the genuineness of Cass’s admission because it had come at the eleventh hour, which differed from his contesting of the complaints in earlier correspondence. The tribunal found that an accountant who allows misleading accounts to be produced breaches public trust. Furthermore, Cass had concealed what he had done in his evidence to the High Court. The tribunal did not consider any alternative sanction other than exclusion.

Chris Cope, solicitor and director of Accountants National Complaint Services Limited comments:

  • Where a judge (particularly a High Court judge) makes adverse findings against an accountant and there is either no appeal or the appeal is dismissed, it is impossible for a regulatory tribunal to question or ignore the decision. The finding of a court of law of competent jurisdiction will be accepted, whatever the accountant might say to the contrary. It is no good the accountant’s lawyer pleading that the judge ‘has simply got it wrong.’
  • Cass did not attend the hearing. No reason is given. He was though, sensibly, represented by Counsel. Unless there are very compelling circumstances (ill-health is really the only explanation), a defendant should attend a hearing. Otherwise, he is not there to answer questions. Non-attendance always seems to me to be frankly discourteous and suggests the accountant no longer values his qualification.
  • A 53% reduction in the costs incurred seems remarkable even taking account of the shortened hearing.

For further information on Chris Cope and the ANCS, visit his website here

About Richard Hattersley

Richard Hattersley

Richard is AccountingWEB's practice correspondent. If you have any comments or suggestions for us get in touch.

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16th Oct 2018 17:17

What a joke of a criminal justice system we have that this drink driver only got 3 years and will probably be out in half that!

https://www.grimsbytelegraph.co.uk/news/grimsby-news/top-judge-jailing-d...

[Edit] See also this similar case:
https://www.getreading.co.uk/news/local-news/tragic-bikers-family-put-an...

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to Justin Bryant
02nd Oct 2018 09:28

On the other hand if you are an environmental protester you get 16 months for sitting on a lorry for a couple of days, in full knowledge of the police who basically stood there and watched them!

https://www.theguardian.com/environment/2018/sep/26/anti-fracking-activi...

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01st Oct 2018 17:08

I do wonder about these Institutes at times - and whether I want to be associated with the people they permit to be members - and who they allow to be senior figures within them. Wasnt't long ago ATT's leader was in serious trouble, for example.

I mean, what a selfish and irresponsible thing to get into a car when THAT drunk. Bordlerline I get - but not actually legless. Then drive off leaving the poor guy for dead for all he cared. Then denies it. Then crys "poor me" at Tribunal.

Personally, I'd like there to be a line of people waiting to give his entitled behind a good whooping when he gets out. Not that he will learn from it. Just cry some more "poor me".

I do wonder what I am paying so much money a year for and about the quality of the people whose brush I am tarnished with, I really do.

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to AnnAccountant
02nd Oct 2018 09:59

For once AnnAccountant's self-righteousness is actually justified! I agree that these scandals happen far too regularly. The CIoT was pretty embarrassed recently with this one:
https://www.accountingweb.co.uk/former-ciot-president-admits-child-[***]...

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02nd Oct 2018 11:45

I would like to know from AnnAccountant and Justin Bryant how exactly they would expect the ICAEW and CIOT to police membership in such a way that they can weed out drunk drivers and other serious offenders before they have actually offended or their offences have become known.

Once the members offences were known, they were excluded, which, as the commentary states, is the only reasonable thing to do. But before then, I find it hard to imagine by what process members can be judged to be likely to offend. Perhaps some detailed questionnaire on members drinking habits, sexual predilections or other potentially criminal inclinations. I think not; imagine the outcry. You need to be realistic.

Sadly all walks of life have bad boys and bad girls including premeditated murderers as well as those irresponsible enough to drink and drive or carry out other serious offences. But identifying them when there is no evidence of potential or actual wrong doings is a tricky thing to do and castigating the professional bodies for failing to do so is quite ridiculous and grossly unfair.

Thanks (3)
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to graydjames
03rd Oct 2018 10:58

I disagree. Anyone put in a senior position of high importance and responsibility, should they be senior bankers, supreme court judges or even ATT and CIoT presidents, should be properly vetted (references, background checks, personality checks and all the rest of it). This happens already for lots of jobs dealing with children, applications for firearms licences etc. , so it's not rocket science to apply that elsewhere as above (people who seek such top jobs tend to be dangerously power mad, psychotic, narcissistic, egotistical etc. in the 1st place (I've met enough of them, trust me), hence the need for such checks in the 1st place).

Such checks would also stop people like Trump getting into power (wishful thinking I know).

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By Dandan
02nd Oct 2018 13:14

This is just bizzare.

Did I read correctly ?

In house accountant indulges in futile window dressing which leads to no benefit; gets struck off with £16k fine.

FCA guy mows down child whilst completly drunk at the wheel and get jailed. Institute think that it deserves full disciplinary hearing to discuss pros and cons, etc. Then a measly fine of £2,500 and a suggestion that really it was not the guy's fault. His friends should have stopped him. Not his fault it seems. Do I detect sympathy because the guy is FCA and ex Council member ?

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to Dandan
02nd Oct 2018 19:39

I do not agree with little the £2,500 fine, and the whole case stinks. It's hard to think a worse case scenario to bring the profession in disrepute. His colleges should also take responsibility and be called in to be disciplined. Where is this fine money going? Has anyone contacted the family of the 16-year old who's life has been destroyed? What is the institute doing to compensate the injured party? Surely they have the decency to support this family overcome this?

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to BJNATHAN
03rd Oct 2018 10:45

Must admit I read it as he got off with no fine at all, that was just costs (and those halved) due to being such a jolly spiffing sort of chap who is on the council.

Dark day for the ICAEW to not clobber him.
To drive over the limit strikes of delusions of entitlement
To hit someone and not stop is a incredibly poor judgement
To try and cover it up and repeat the offence by driving 100+ miles to hide is simply unforgivable.
At the very least having got to the ex-wifes you calm down, get a taxi back to the scene of the cime and face the music having made the initial two poor decisions.

Its just a lack of basic integrity.

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02nd Oct 2018 19:28

You can do all manner of dodgy bank audits for billions of pounds. Audits which at least partly led to the financial crash, by misrepresenting the true state of health of 300 or more European banks which had clean audit reports but needed big bailouts.

You can also do well dodgy clean audits of companies like Carillion and Globo, which go bust just months later with huge black holes suddenly in their accounts.

You can have your fingerprints all over the worst tax scams, such as the Panama papers and similar recent public scandals.

But as long as your letterhead says you are in the Big 6 you stand no chance of any sort of disciplinary, let alone actually being booted out.

Misrepresent a £50k directors loan and you get massive hobnailed boots up the backside. Don't get me wrong that is fair enough in my view.

So all the well dodgy Big 6 guys should also get the boot, then, to be consistent.

That would transform auditing from a chocolate fireguard into something resembling a decent probe, and reduce the deficits of most of the G20 by increasing tax revenues.

Then we'd be getting somewhere.

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