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RSM Tenon boss fined by ICAEW 16 August 2010

Jackson has been fined 5,000 and paid costs of £83,557 after admitting that he failed to collect £330,000 as liquidator of a failed company, an Institute of Chartered Accountants England and Wales disciplinary tribunal found.

Jackson had enlisted a debt-collection agent to recover £330,000 from the former directors of a failed company on behalf of its creditors. However, instead of the agent transferring the retrieved assets to Jackson’s solicitors’ account he directed the cash to his own bank account in Monaco.

As a result Jackson was unable to pass any of the funds to creditors, because they were being held by the agent in Monaco. The tribunal found that Jackson had failed to adequately record or evidence the terms of engagement with the agent.

The tribunal said that despite Jackson not previously having concerns of the agent’s “probity and honesty”  he did not put in place “adequate arrangements for the payment of monies”.

The disciplinary hearing said that this was an "error of judgement", given the amount of money involved and the debt-collection agent’s unregulated and professional status, and was an important factor in the loss of the monies to the creditors.

It also said that when Jackson learnt that the £330,000 had not been paid into the solicitor’s account he did not take immediate action, but instructed the law firm to chase the debt - who failed to do so with any haste. 

Jackson’s representative said the error was a bad commercial judgment, but had been an isolated one. Jackson had also been let down by his solicitors, who required constant chasing.

The Tribunal ruled that Jackson “had failed to exercise sufficient control of the situation. That said, he had been misled by his agent and let down by both his agent and his solicitors.”

The case relates to events over eight years ago and the decision was mitigated by the fact that it was an isolated incident and Jackson's impressive character references. The panel was also satisfied that Jackson had taken the necessary steps to ensure it didn’t happen again such as strengthening the compliance team and working with a set panel of agents.

Jackson’s representative said that he felt enormous regret for what had happened, took full responsibility, and made no personal gain – the firm had also lost a significant amount of money in handling the case.

A spokesman for RSM Tenon said that the company had paid for Jackson’s legal costs: “We are proud of our professional standards and have an excellent record, as does Carl. We therefore stand behind employees who validly defend their personal position after performing work that has generated earnings for the business.”

However, Jackson did pay his fine out of his own pocket.

 

 

 

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