In a nutshell, what can we do for you?

1. You need advice about handling a difficult client who threatens to sue you. We’ll provide it.

2. You lose a client to another accountant who demands your working papers. We’ll advise you.

3. Someone reports (or threatens to report) you to your Institute or another body. We’ll handle it.

4. Your explanation is rejected and you must appear before an Institute committee. You’ll be represented by an expert lawyer and we’ll meet his costs.

5. You need help interpreting the Institute’s disciplinary bye-laws or members’ handbook. Our specialists will guide you. We have six specialists – a barrister, two solicitors, two chartered accountants and SWAT.

6. You are offered a consent order by the Investigation Committee. We’ll advise you whether to accept and the indemnity insurance implications.

7. A company in which you were a non-executive director is insolvent. Directors Disqualification Act proceedings have been brought. Your solicitors are advising on a Carecraft Settlement. They know nothing about what action the Institute will take. We’ll give that advice.

8. There’s a claim under your indemnity insurance policy and the City lawyers acting for underwriters can’t advise you. We will.

9. There’s a threat to your audit/insolvency/financial services licence. We’ll protect your interests.

Why should this service be of interest to you?

Although you are unlikely to be complained about or disciplined, no one can guarantee this. You cannot expect to survive 40 years in practice without having a disagreement with a client or some third party such as another accountant or a solicitor. Some clients are unreasonable and will insist on a complaint being pursued to committee, even if the case manager at your professional body disagrees with the complainant.

A case manager can raise his own complaints, additional to those made by the complainant, which you must answer. It is a requirement that you must answer a complaint within 14 days and that disciplinary proceedings must take priority over everything else. Would you have the time to respond, particularly in the month of January?

The world in the 21st century is far more contentious than it was 30 years ago. The public is well informed. People know their rights. They are far more willing to complain than ever before, particularly if they think they will receive a large cheque at the conclusion. Due to political and public pressure, professional bodies are forever taking steps to expand and toughen their rules and regulations. For instance, since 1st January 2008, ICAEW disciplinary proceedings have been open to the public and the press. Read all about ‘Accountant's shame’ in next Thursday’s issue of Accountancy Age! The Institutes will and do take tough action against transgressors.

If you've never had a complaint, why should you need Accountants' Defence?

Shortly after we set up Accountants’ Defence in January 2004, a solicitor colleague tried to persuade a certified accountant friend to take out a subscription. The certified accountant (a sole practitioner) said that he thought that spending £150 a year on a subscription to an advisory service was a waste of money as he had never had a complaint in his life and did not expect to receive one. He did not take out membership. A couple of months later, he was reported to the ACCA by another accountant. Much to the certified accountant’s surprise, he was referred to the Disciplinary Committee. On advice, he pleaded guilty to the charge. The charge related to whether or not he was entitled to retain papers belonging to a client, following a change in accountants. He was legally represented before the Disciplinary Committee. The legal fees which he incurred were £1,500, 10 times the subscription he would have paid in January 2004 and which would have ensured free representation. (Today, his legal fees would have been substantially greater).

Reasons for Accountants' Defence

Set up to help accountants in practice who get into difficulty and to provide accountants' disciplinary hearing advice. In disciplinary proceedings, many accountants are failing to act in their best interests or take adequate care of their own affairs. Even if the dispute with the client never reaches the professional body, we will provide advice and assistance.

Why be represented?

Stress – Legal representation can alleviate some of the stress.
Experience – An experienced lawyer will have appeared before a tribunal on many occasions.
Objectivity – The lawyer will bring objectivity to the case.
Preparation – In preparing the case, lawyers know what matters and what does not. They will focus on relevant issues and avoid protracted correspondence.
Cost – And if you are a member of Accountants' Defence, it could cost you nothing apart from your annual subscription.

What difference can representation make?

Without effective representation at all stages of a complaint, many have suffered unnecessary damage to their reputation. Some have received substantial fines, which could have been avoided. Some have even lost their qualification and livelihood – possibly avoidable. Some, having failed to contest the disciplinary proceedings, have subsequently been unable to defend an interconnected civil action. Others have been unable to obtain insurance cover as a result of a disciplinary finding or had to pay a massively increased premium. Professional advice would have addressed these issues.

Consent orders

The Investigation Committee at ICAEW offers consent orders which the member can accept or reject. If he rejects, the case goes to the Disciplinary Committee. Consent orders are no different from disciplinary findings. All attract publicity. As Consent Orders are admissions of liability, there can be serious professional indemnity insurance implications. Insurers' approval must be obtained before a consent order is accepted. Accountants' disciplinary hearing advice before a case is referred to the Investigation Committee could influence the outcome. Legal advice should always be obtained before a consent order is accepted.

In 2008, the Investigation Committee made over 100 consent orders, imposing fines and costs in most cases.

ACCA has abolished consent orders. Cases go directly to the ACCA's Disciplinary Committee unless the Assessor (there is no longer an Investigations Committee) decides that the case should 'rest on file'.

Need for advice

Not every case requires legal representation. But legal advice can be important at certain stages. Don’t forget that a complaint may be the forerunner to a claim. A mark of disapproval by the professional body could help in securing financial compensation against you. You will have to spend time dealing with a complaint. A complaint is often an attempt to avoid payment of fees. You do not want to lose all or part of your fee as well.

If the practitioner believes that he is innocent, he would be unwise to admit the complaint. Get legal advice beforehand. Even when pleading guilty, a good plea in mitigation could prevent exclusion or reduce the size of fine. Accountants' Defence was established with the aim of providing sound accountants' disciplinary hearing advice and effective representation at no cost to the member.

But we do more than assist our members when complaints are made. If a member has a difficult client and believes this could lead to a claim, a complaint or legal proceedings, we will advise him. And what should a member do when he’s lost a client to another firm and receives a professional enquiry letter demanding all his working papers, plus files going back six years and threatening to report matters if they do not receive his full cooperation within seven days? The guidelines may appear confusing. A call to our hotline will result in advice from our team of specialists.

What will membership cost?

Annual subscription for a sole practitioner - £170 plus VAT for all practising qualified accountants.
However, in the first year of membership or part (as applicable), we offer a 50% discount on subscriptions.

We offer a lower per capita subscription for non sole practitioners, depending upon size of firm.

What will Accountants' Defence provide?

For complaints, regulatory, disciplinary and appeal cases, Accountants' Defence will underwrite legal and professional fees up to a maximum of £10,000 plus VAT. If the costs exceed £10,000 (very unusual in our experience), these must be borne by the member.

Why should this service be of interest outside England/Wales, ie to members of the ICAS?

We acknowledge that the rules and regulations of the ICAS, and its disciplinary procedures, differ from those of the ICAEW, ACCA and CIOT. Nevertheless, we are familiar with the workings of the ICAS. Christopher Cope has represented a number of members of the Institute of Chartered Accountants of Scotland in both complaint investigations and before the Discipline Committee. The cost of our advocates and experts travelling to the Institute of Chartered Accountants of Scotland will be met by Accountants' Defence.

Surely these services are provided by your indemnity insurers?

Most policies will not provide cover for legal fees on complaints and disciplinary cases, unless it is clear that a complaint is likely to lead to a claim. In those circumstances, underwriters have a discretion whether to instruct panel solicitors (or those of your choice who will be expected to have specialist skills) to advise/assist with regard to the complaint investigation. Where there is little or no likelihood of a claim, your PII policy normally will not help you. Accountants' Defence can, though, help; that's why we were established.

Doesn’t your professional body provide help?

Generally, it cannot advise you if it is carrying out an investigation into your conduct. However, it can – and will – provide technical advice. If you are not satisfied with the advice received from your professional body, or would rather not approach them, speak to us.

Surely your local High Street solicitor can handle this?

Professional conduct is a speciality. Few UK lawyers have the experience of investigating and prosecuting accountants gained by Christopher Cope at the ICAEW from 1976-1983 and, since then, as a defender of accountants. Furthermore, no UK lawyers have represented more accountants before disciplinary tribunals than Christopher Cope, (well over 300 cases to date). All practising solicitors must notify their indemnity insurers of the areas of law in which they intend to practise. As the average High Street solicitor will rarely be approached to handle a matter of professional discipline, he will almost certainly have no PI cover in respect of any disciplinary work he decides to accept on a one-off basis, even if he arranges for counsel to handle the advocacy.

It is essential, therefore, to instruct the experts for accountants' disciplinary hearing advice. Every member of our team has considerable experience and expertise - that's why we selected them.

Household insurance

Everyone who owns a house is insured against fire and theft. No one expects a fire or to be burgled, but no one can guarantee that it will never happen. Although household insurance can be expensive, you would be most unwise not to arrange cover on the basis that you are unlikely to be making a claim. Sadly, we frequently learn of many householders flooded out by heavy rain who had not arranged contents insurance because they didn’t believe they were at risk from floodwater. Membership of Accountants’ Defence is your way of protecting yourself against that future nasty problem you could never have anticipated. We are not, though, an insurance company.

Technical advice

Initial free telephone advice on practice problems. Thereafter, the adviser will charge the member at an hourly rate for technical advice (for instance, practice assurance issues, audit opinions, client money regulations and changes in professional appointments). Practice Assurance and the Money Laundering regulations continue to cause problems for practitioners. Accountants' Defence can help.

Negligence Claims

If a member is subject to a negligence claim, he will advise his professional indemnity insurers who will, undoubtedly, instruct large City solicitors. They will have immense experience. However, their role is to protect the interests of insurers. That may conflict with the interests of the member. If the member needs independent legal advice about his interests (for instance preparing a written response to the City lawyers), he should consult Accountants' Defence. We will provide advice and assistance. Moreover, we will underwrite the member’s legal fees up to £2,500. In this way, we hope to provide wise counsel and helpful assistance. For instance, PI insurers might attempt to avoid liability. We are there to advise in such circumstances.

Newsletter

Members will receive a quarterly newsletter (Lifeline) dealing with professional conduct and technical issues, including case studies.

ALWAYS read the small print

In common with other professional defence organisations, Accountants' Defence does not provide insurance services. Accordingly, Accountants' Defence cannot guarantee provision of services in each and every case or that it will always provide a service without limit of time or expense.