KPMG LIQUIDATORS have been called to collapsed law firm Follett Stock following a HM Revenue & Customs winding-up order earlier this year.
David Standish and John Milsom were appointed joint liquidators to Follet Stock LLP and Follett Stock Holdings on Monday 4 November following a “substantial” winding up order by the taxman in September.
The Solicitors Regulatory Authority has intervened in the liquidation, taking on all client work and accounts to ensure continuity of cases.
In an unusual twist the SRA intervened after KPMG liquidators were appointed. Usually when a law firm is in financial difficulty the SRA will intervene prior to it entering an insolvency process. Accountancy Age understands this is the first time that the SRA has intervened at this stage for a large firm.
As a result of the collapse of the Follet Stock, the liquidators have made all 30 staff redundant and are currently investigating if any assets can be realised for the creditors.
Speaking to Accountancy Age Standish said: “The SRA has the statutory ability to intervene if a partner firm is in difficulty. We have no ability to deal with client cases, they have the lawyers for that.
“The SRA has collected all client files and all contact for clients should go through them, however we are still the liquidators and we will work alongside the SRA.”
He added that the regulator and liquidators are due to speak imminently about the collapse.
Law firms are in for a rough ride, with changes to employment tax of LLPs, as well as changes to professional indemnity insurance, and a crack-down on how firms can obtain their fees in “no win no fee” cases.
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