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SRA reclaims enforcement credentials with record £250k fine on White & Case

Firm admits it acted recklessly in conflict of interest probe

20 July 2017

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The Solicitors Disciplinary Tribunal has rubber-stamped an agreed outcome between the Solicitors Regulation Authority and White & Case to fine the US-headquartered firm a record £250,000 for breaking rules on conflict of interest. David Goldberg, a partner specialising in international commercial and investment arbitration, was also fined £50,000.

This is five times the previous record for an SRA fine. In April, the regulator fined Clyde & Co £50,000 and three of its partners £10,000 each for using the firm’s client account as a banking facility.

It will help the SRA reclaim some enforcement credentials just five weeks after it failed to secure a conviction against Leigh Day. On 9 June, the Solicitors Disciplinary Tribunal cleared the civil liberties firm of 19 allegations of misconduct after a seven-week trial estimated to have cost as much as £10m.

The exact details of the White & Case decision will not be known until the SDT publishes its ruling in the next few weeks.

In 2014, the High Court restrained the firm from representing Victor Pinchuk, Ukraine’s second richest man at the time, in a case against two rival tycoons, Igor Kolomoisky and Gennadiy Bogolyubov, because it had previously acted for the pair. There is no indication at this stage that this is the case considered in the agreed outcome.

According to a notice published on the SRA’s website, White & Case admitted that it allowed work to be carried out for clients without causing adequate steps to be taken to ensure that no conflict or significant risk of conflict existed between the interests of clients, and that it allowed instructions to be accepted to undertake further work for clients without causing adequate steps to be taken to ensure the confidentiality of information provided to the firm by clients was protected.

It also admitted that it acted recklessly in respect of these matters.

Goldberg admitted that he acted for clients in circumstances in which there was a significant risk of a conflict of interest between clients and that he did not take or cause to be taken adequate steps to ensure the protection of confidentiality of information provided to the firm by or acquired during the course of acting for clients.

He also admitted he continued to act for clients in circumstances in which there was a significant risk of a conflict of interest between clients and provided confidential information concerning the work being undertaken on behalf of a client in one matter to a partner in the firm involved in acting on a matter giving rise to a significant risk of a conflict of interest between clients.

Goldberg further admitted that he failed to cause adequate steps to be taken to ensure that no conflict existed between the interests of clients, and to protect the confidentiality of information of clients. As the partner with overall responsibility for the matter involved, he admitted that he had, in not making inquiry as to specific matters relating to the client instructions, acted recklessly.

The SRA said there had been no allegation that the firm or Goldberg acted dishonestly.

The regulator also said that in light of evidence submitted by and on behalf of Goldberg and the firm, it had decided not to pursue allegations of lack of integrity against either.

Jean-Yves Gilg, editor-in-chief

jean-yves.gilg@solicitorsjournal.co.uk | @jeanyvesgilg

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Solicitors Disciplinary Tribunal Solicitors Regulation Authority Fine Agreed outcome conflict of interest confidentiality