The first solicitor ever prosecuted for ‘TIPPING OFF’ is suspended for using the firm’s account as a banking facility.

It has been reported that the first solicitor ever prosecuted for ‘tipping off’ a client about a money laundering investigation has been suspended from practice for allowing a client to use his firm’s account as a banking facility.

The Solicitors Disciplinary Tribunal (SDT) also fined Osmond Solicitors’ compliance officer.

• https://www.legalfutures.co.uk/latest-news/solicitor-suspended-after-clients-millions-pass-through-bank-account

KEY FACTS

• The Solicitors Regulation Authority’s (SRA) investigation was triggered by William Osmond’s arrest by the Serious Fraud Office (SFO) in 2019.
• In 2023, the co-founder and senior partner was sentenced to nine months in jail, suspended for 18 months, for tipping off a client about an SFO investigation; no SDT proceedings followed,
• William Osmond, the owner of Osmond Solicitors Ltd, has been suspended for allowing his firm's client account to be used as a banking facility for over £30 million  
• The Solicitors Disciplinary Tribunal (SDT) found that between May 2014 and October 2017, the firm received £31.9 million and paid out £28.3 million without any underlying legal transactions to justify these payments 
• Osmond admitted to allowing these transactions for a client's convenience, which created a significant risk of facilitating money laundering  
• As a result, he has been suspended for 12 months and faces indefinite restrictions on his practice 

THE TRANSACTIONS WITH PERSON A

• William Osmond, who qualified in 1979, was the owner and manager of the firm and Person A’s primary point of contact.
• The SRA alleged that the London firm received and paid out £388m in multiple currencies on behalf of an overseas businessman, ‘Person A’, and charged him nearly £1.2m in fees.
• From 2003 to 2019, the firm acted for Person A, or a company owned or controlled by him, on approximately 132 matters, and he accounted for about 10% of its turnover.
• The case before the tribunal concerned six exemplified matters relating to Person A’s companies. Between May 2014 and October 2017, the firm received £32m and paid out £28m without any underlying legal transactions to justify the payments.
• In mitigation, Mr Osmond pointed out that none of the transactions had resulted in loss to any client or third party, and he had not profited from them.

NOT FOLLOWING THE RULES

• William Osmond admitted to breaching the SRA accounts rules and contributing to the firm’s anti-money laundering failures by failing to conduct ongoing monitoring of its business relationships or applying enhanced customer due diligence.
• Once he became aware of the banking facility rules, he added, he stopped making payments and returned all the funds held by the firm to Person A.
• The SDT said allowing the use of client accounts in this way, “for no other reason than the convenience of a client”, was a grave breach of the rules.
• The number of transactions and the time it lasted aggravated the misconduct.
• It said: “Aside from the firm’s own written anti-money laundering policies, controls and procedures, there was clear guidance from the Law Society and the SRA warning of the need to mitigate the risks of the firm’s services being used for money laundering, which [Mr Osmond] should have been aware of.”
• Despite the mitigation, the SDT considered the misconduct serious enough to consider striking off Mr Osmond.
• However, a regulatory settlement agreement between the SRA and the solicitor proposed a 12-month suspension and, on his return to practice, indefinite restrictions that he cannot be a sole owner of a law firm or a compliance officer, hold client money or be a signatory on any client account.
• This convinced the SDT that the public would be “adequately protected” from Mr Osmond.

THE COMPLIANCE OFFICER

• Paul Christopher Flaherty, who qualified in 2007, held both compliance officer roles at Osmond & Osmond from January 2015 and admitted allowing the use of its client account as a banking facility.
• He told the tribunal that after he took on the roles and spotted high-value transactions which did not appear to relate to conveyancing matters, Mr Osmond had assured him that the entries were “properly made”.
• Mr Flaherty knew about Person A from his time a decade earlier as Mr Osmond’s trainee “and accepts that he took that assurance on trust without making any further inquiries or checking the files himself”.
• It was only in September 2017, when the firm’s auditor said it would qualify its accountant’s report, that he discussed further with Mr Osmond and insisted that the payments could not continue.
• There was no suggestion Mr Flaherty had otherwise breached his obligations – he admitted treating Mr Osmond differently from all others at the firm.
• The SDT acknowledged the solicitor’s regret “for his mistaken belief that he could rely on assurances from his co-partner whom he respected, trusted and had known for over 10 years”.

FINES

• It approved a separate settlement agreement that a fine of £5,001 was appropriate.
• The SDT also ordered Mr Osmond to pay £50,000 in costs and Mr Flaherty to pay £15,000.

SFO-SRA investigations

A Solicitors Disciplinary Tribunal judgment disclosed that William Osmond, owner of Osmond Solicitors Ltd, was arrested by the Serious Fraud Office on suspicion of offences relating to money laundering.

• The SFO executed a search warrant at the firm’s premises, which resulted in the seizure of several hard-copy files.
• The Solicitors Regulation Authority commissioned its forensic investigation.

SFO

• On 10 April 2019, William Osmond was arrested by the Serious Fraud Office on suspicion of offences relating to money laundering.
• The SFO executed a search warrant at the Firm’s premises, which resulted in the seizure of several of its hard copy files.
• William Osmond stated that the first enquiry from the SFO was ‘probably’ in May 2018.

SOLICITORS REGULATION AUTHORITY [SRA] INVESTIGATION

• Following the Respondent’s arrest, the SRA commissioned its forensic investigation. This commenced on 11 April 2019 and ultimately resulted in a detailed report dated 3 July 2020 (
• Records showed that between May 2014 and October 2017, the firm received £31.9m into its client account regarding six matters and paid out £28.3m.
• All the transactions related to a client referred to as Person A, whom Osmond described as a ‘substantial client of the firm accounting for about 10% of its turnover’.

EXTRACTS FROM THE JUDGMENT SHOW

• The SDT found no underlying legal transactions to justify all those payments, and Osmond caused or allowed them to be made.

OSMOND ADMITTED ALLOWING

• ‘The firm’s client account is to be used as a banking facility, for no other reason than the convenience of the client, '

THE SDT JUDGMENT SHOWS.

• ‘There was no evidence discovered by the Forensic Investigating Officer to suggest the respondent ever questioned Person A to ask why he was being asked to receive/make payment of funds and for what purpose.
• This was despite the significant payments made to third parties across all six matters.’
• Osmond admitted to continuing to authorise transactions over thirty-nine months, creating a clear risk that the firm would facilitate money laundering.
• In mitigation, he pointed out that none of the transactions resulted in loss to any client or third party, and he did not profit from them.
• Although the tribunal felt the misconduct ‘fell within the range to merit striking off from the roll’, it agreed to an indefinite restriction order and a 12-month suspension.
• The restrictions prevent Osmond from practising as a sole practitioner, sole manager, or sole owner of an authorised or recognised body, as a freelance solicitor, as a solicitor in an unregulated organisation, as a head of legal practice/compliance officer for legal practice or a head of finance and administration/compliance officer for finance and administration, holding client money, or being a signatory on any client account.

IN THE JUDGEMENT, IT IS RECORDED THAT

JAMES? AS NOTED BELOW, IN NOVEMBER 2023,

• Osmond was convicted of tipping off and informing his client, JAMES REDDING RAMSAY, about the investigation and forging a document to mislead the SFO.

16 NOVEMBER 2023 TIPPING OFF

The first solicitor ever prosecuted by the Serious Fraud Office (SFO) for ‘tipping off’ a client about a money laundering investigation has been convicted.

• William John Gregory Osmond, a solicitor and co-founder of the London law firm Osmond & Osmond, was investigated by the Serious Fraud Office (SFO) for tipping off his client about a money laundering probe.
• He was convicted of informing his client, James Redding Ramsay, about the investigation and forging a document to mislead the SFO.
• Osmond was sentenced to nine months in prison, suspended for 18 months, and ordered to complete 100 hours of unpaid work.
• Prosecutor James Waddington KC told the court that Mr Ramsay came to the SFO’s attention through its investigation into Eurasian Natural Resources Corporation, which ran from 2013 until it was dropped in August.
• Further, in response to an SFO request, the solicitor supplied a fake ‘letter of engagement’ that set out his role as a solicitor for a British Virgin Islands company, which was purchased by Mr Ramsay and used to move funds to buy the London property.
• SFO investigators searched Mr Osmond’s office in 2019, revealing five handwritten handwritten notes on his discussions with Mr Ramsay and computer files showing his forgery of the letter.
• The solicitor, who had acted for Mr Ramsay for more than 20 years, earlier told the court it was “traumatising” being arrested in 2019 after so many years as a solicitor

SOURCES

• https://www.legalfutures.co.uk/latest-news/solicitor-suspended-after-clients-millions-pass-through-bank-account

TIPPING OFF SOURCE

• Solicitor convicted of tipping off client about money laundering probe https://www.legalfutures.co.uk/latest-news/solicitor-convicted-of-tipping-off-client-about-money-laundering-probe
•  Nine-month sentence for solicitor who tipped off client - https://www.gov.uk/government/news/nine-month-sentence-for-solicitor-who-tipped-off-client

CUSTOMER MONEY Source

• https://www.lawgazette.co.uk/news/solicitor-arrested-by-sfo-allowed-firm-to-be-used-as-30m-banking-facility/5122948.article
• https://solicitorstribunal.org.uk/case/12647/
• https://solicitorstribunal.org.uk/wp-content/uploads/2024/09/12647.2024.Osmond.Flaherty.pdf

SRA

• https://www.sra.org.uk/consumers/solicitor-check/090805/
• https://www.sra.org.uk/consumers/register/person/?sraNumber=90805