Time To Audit Attorneys' Client Accounts
The problems which the public has had with lawyers and the PSV sector over the many years may have something in common. The policymakers have continued to demonstrate an aversion to imposing controls to address the problems which have perennially plague the two businesses. Even as our policymakers fiddle while the PSV sector lay prey to our once orderly society; so too many lawyers continue to fleece Barbadians ignorant of the law and process out of their hard earned dollars.
It is no secret lawyers over the years have used their Client Accounts as a source of other income. They can deny it all they want but we know that it happens. Funds are received from clients to settle transactions and because of the drawn-out process to consummate legal transactions; results in those funds remaining in interest bearing Client Account for lengthy spells. If the interest earned on those Client Accounts was freely passed to the clients by the lawyers who would care? The fact of the matter is many of our lawyers retain the interest earned masked under the explanation of administrative fees. In recent years those most vulnerable to some of these thieves who wear wigs have been the group commonly referred to as returning nationals.
In was very interesting following the comments about lawyer’s Client Accounts in the local media by former Ernst & Young partner Peter Boos on the weekend. He was very deliberate in making the point that Barbados could eliminate the problem of lawyers defrauding clients through the misuse of Client Accounts by introducing legislation to have the Client Accounts audited. The suggestion seems so simple? Boos went on to elaborate by revealing such legislation already exist in many countries around the world. A BU family member added on another blog that other professions should be brought under the ambit of legislation.
A cursory surf of the Internet supports the point that best practice is out there and with the will Barbados could easily model. Again it makes BU wonder why successive governments would remain idle while some members of the legal profession have become very rich by fleecing Barbadians over the years. Perhaps the answer can be found in the fact that our politicians and by extension our Lower House is dominated by lawyers.
What we like about the link to the best practice in the USA is the recognition that despite high standards misappropriation of client monies will occur. When such thiefing occurs the lawyers involved will NOT have the wherewithal to repay. In the US they have done a sensible thing by creating a Client Protection Fund – see fro yourself:
Funding can be generated from a variety of sources including mandatory assessment, legislative budget appropriation, and voluntary contribution. Mandatory assessment by court rule has proven to be the preferred method of assuring continual funding and staffing. Funds that receive revenues through mandatory assessment are preferred because the result is a reliable and predictable source of income. This allows a Fund to fully reimburse losses and to engage in public information, continuing legal education programs, and related activities. Voluntary contribution is the weakest funding method; it does not provide the Fund with broad-based and permanent income.
The time for the long talk need to stop. Our Chief Justice can leave a meaningful legacy by working with the Attorney General’s Office to stop the stealing.