Disciplinary

PUBLICITY NOTICES

Kevin McLeod

In terms of ICAS Rule 13.21, notice is hereby given that the ICAS Investigation Committee has found Mr Kevin McLeod, a CA member and licensed insolvency practitioner, guilty of professional misconduct (in relation to charges 1, 2 and 4) and unsatisfactory professional conduct (in relation to charge 3) on the basis of the following:    

1. When acting in the capacity of appointed liquidator of Company A, he failed to ensure that the estate money was at all times held subject to appropriate financial controls, and to safeguard the estate funds from misappropriation in breach of the requirements contained in paragraphs 2, 4, 6, 8 and 9 of Statement of Insolvency Practice 11.

2. When acting as trustee in sequestration of Debtor B, he failed to properly and timeously renew an inhibition to protect the estate’s interest in the heritable estate, to the actual or potential prejudice to creditors, in terms of Section 39A of the Bankruptcy (Scotland) Act 1985, and in breach of the requirements contained in Part 2.25 of the Accountant in Bankruptcy’s Notes for Guidance for Trustees (relating to bankruptcies granted between 1 April 2008 and 31 March 2015, version 8).

3. When acting as trustee in sequestration of Debtor B, he failed to properly recover, manage and realise the debtor’s estate as required in terms of Section 3 of the Bankruptcy (Scotland) Act 1985.

 4. As sole director of his insolvency practice, TDC Solutions Limited, he failed to submit to Companies House the statutory accounts for his business, for the accounting periods ending:

(a)  31 March 2019

(b)  31 March 2020

(c) 31 March 2021

(d)  31 March 2022

as required by Section 441 of the Companies Act 2006.

Charges 1–3 constitute a breach of Regulation 4.12 of the ICAS Insolvency Regulations, and Charges 1–4 constitute a breach of the fundamental principles of professional competence and due care, and professional behaviour, contained in the Code of Ethics.

Sanction

Under operation of Investigation Regulation 2.15, Mr McLeod has accepted an order of exclusion from membership and a requirement to pay £8,470 in respect of ICAS’ costs.

Commentary

• In August 2022, the Investigation Committee (“the Committee”) received a referral from the ICAS Authorisation Committee following an insolvency monitoring visit to Mr McLeod. The referral related to concerns regarding (i) a failure to safeguard estate funds when acting as an appointed liquidator (in particular, he was not a signatory to the estate account where the funds were held for several months) and (ii) a failure to renew an inhibition over a property timeously when acting as a trustee in sequestration. Both these failures were to the actual or potential prejudice of the respective creditors.

 • While investigating these matters, the Committee identified further concerns in relation to Mr McLeod’s handling of the sequestration. In particular, the Committee found that Mr McLeod had failed to properly recover, manage and realise the debtor’s estate and had delayed in progressing the sequestration. It also came to the Committee’s attention that no statutory accounts had been filed with Companies House since December 2018 in respect of Mr McLeod’s own insolvency practice, TDC Solutions Limited. This is a basic statutory requirement that a CA should be familiar with.

 • The Committee determined that these failures were such a serious departure from the standards to be expected of an ICAS member and licensed insolvency practitioner that they constituted professional misconduct in respect of Charges 1, 2 and 4 and unsatisfactory professional conduct in relation to Charge 3.

 • In reaching its decision on sanction, the Committee had regard to the Common Sanctions Guidance for Insolvency Complaints. The following aggravating factors were identified: (i) an apparent lack of understanding or acceptance of the charges; (ii) actual or potential prejudice to third parties; and (iii) Mr McLeod’s poor disciplinary and regulatory history. One mitigating factor was identified, in respect that Mr McLeod’s insolvency licence was subject to a restriction which would reduce the risk of reoccurrence or repetition of the conduct in Charges 2 and 3. However, the aggravating factors significantly outweighed the mitigating factors. The Committee concluded that the totality of Mr McLeod’s conduct demonstrated several distinct, fundamental failings and was so significant and impactful that no lesser sanction than exclusion was appropriate.

Gregory Lane CA

In terms of ICAS Rule 13.21, notice is hereby given that the ICAS Investigation Committee has found Mr Lane guilty of professional misconduct on the following grounds:

On 12 May 2023, Mr Lane was convicted of the criminal offence of assault, which brings discredit to him, ICAS and the profession of accountancy. He has failed to adhere to the fundamental principle of professional behaviour contained in Section 115 of the ICAS Code of Ethics and is therefore liable to disciplinary action under ICAS Rule 13.1.2.

Sanction

Under operation of Investigation Regulations 2.15.3 and 2.15.5, Mr Lane has accepted an order of severe reprimand and a financial penalty of £2,500 and to pay £1,680 towards the reasonable costs of the investigation.

Commentary

• Mr Lane notified ICAS of this matter.

• Mr Lane was convicted of assault at Edinburgh Sheriff Court on 12 May 2023 and was sentenced on 9 June 2023. The sentence received by Mr Lane comprised a community payback order of 180 hours and a compensation order of £1,500.

• The ICAS Rules provide that a member shall be presumed to be guilty of professional misconduct if (a) convicted in the United Kingdom of an indictable offence, or (b) sentenced to imprisonment on summary complaint.

• The Investigation Committee concluded that Mr Lane’s conviction represents prima facie evidence that he is guilty of professional misconduct, and that he is therefore liable to disciplinary action. In addition, the Committee considered that Mr Lane has breached the fundamental principle of professional behaviour, as set out in Section 115 of the ICAS Code of Ethics, in that he failed to avoid actions which he knew (or should have known) would discredit the accountancy profession.

• Taking account of the nature of the offence, and the harm to a third party, the Committee took an extremely serious view of the case – regardless of the fact that the behaviour occurred in a non-professional capacity. The Committee had little difficulty in concluding that Mr Lane’s conduct fell far below the standards that members of the public reasonably expect of Chartered Accountants.

• Taking account of certain mitigating factors, the Committee decided that the matter could be dealt with through a sanction falling just short of exclusion from ICAS membership, namely an order of severe reprimand and a financial penalty of £2,500.

 • Members require to notify ICAS of criminal charges or convictions in terms of Regulation 2.2 of the ICAS General Regulations.