RSM Tenon recovery chief fined £5,000 by ICAEW

RSM Tenon recovery chief fined £5,000 by ICAEW

RSM Tenon's Carl Jackson ordered to pay fine and costs by ICAEW tribunal after admitting failure to collect £330,000 of creditors' funds

RSM Tenon head of recovery Carl 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
ICAEW
disciplinary tribunal
found.

The tribunal said that Jackson, of Eastleigh, Hampshire, had failed to
collect £330,000 from an agent on behalf of the liquidated company’s creditors;
and that he had failed to make a full and proper disclosure to the creditors
about the problems he had gaining access to the funds.

The debt-collecting agent received £330,000 from former directors of a
liquidated company on behalf of Jackson as liquidator, for its creditors. The
funds, however, were placed into the agent’s bank account in Monaco, rather than
the account of Jackson’s solicitors.

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.

In his report to creditors, Jackson failed to make full and proper disclosure
of the full amount recovered from directors; payments remitted to the agent;
fees the agent was claiming and seeking to offset against the funds; and the
extent of the difficulties Jackson had encountered in recovering the funds
wrongly retained by the agent, the tribunal found.

In mitigation, Jackson’s representative said that even with fuller terms of
engagement with the agent, it would have made no difference to the subsequent
difficulties in recovering the money.

Jackson’s representative went on to say there were no grounds to doubt the
agent’s honesty and probity and Jackson had received legal advice on the
arrangement with the agent.

He 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.

No loss had resulted from Jackson’s reporting deficiencies and had been an
isolated incident, said Jackson’s representative. There had been no deliberate
misleading of creditors, a point accepted by the ICAEW’s investigation
committee.

Many of the events had taken place more than eight years ago, and the
investigation began in 2006. This had been hanging over the defendant’s head for
a very long period.

Jackson had already taken action since these events so that the particular
issues would not recur. The firm had set up a panel of agents, created letters
for appointment of agents, and its compliance team had been strengthened.

He also provided impressive character references and was held in high regard
within the profession, said the representative.

At the time of the liquidation he had been exceptionally busy, said his
representative, and had taken on too much work. 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.

In the sentencing order, the tribunal said there had been a failure to comply
with the defendant’s duties as a liquidator, resulting in the funds being lost
to creditors. Jackson had failed to exercise sufficient control of the
situation, but had been misled by the agent and let down by both the agent and
his solicitors. The tribunal found there had been strong mitigating
circumstances.

Jackson was reprimanded, fined and ordered to pay costs.

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