Exclusion avoided by accountant

7th July 2022

We look at a case where legal representation proved crucial for an accountant to avoid exclusion.


SM had been employed by one of the profession’s top accountants for three years. His contract made it clear that if he failed an exam twice, his contract as a graduate employee would automatically be terminated. He failed the exam and accepted that he would have to leave.

In the final month of SM’s employment, on three occasions, he downloaded to his personal laptop, a substantial amount of confidential data belonging to his employers for which he had no authority.

On his final day at the firm, IT notified SM’s boss that they had detected the transfer of confidential data. SM was advised that the matter was to be investigated. SM agreed to provide his full cooperation which he did over the next couple of months. All the data was successfully retrieved. None had been used by SM for questionable purposes or shared with others.


The matter was reported to the Institute of Chartered Accountants in England and Wales (ICAEW) for investigation. At the time, SM was still a student. The investigation turned out to be an extremely protracted process. In the meantime, SM passed the outstanding exam and qualified.

Inevitably, the case was referred to the Disciplinary Committee (DC). Very sensibly, SM decided to seek legal advice and engaged Blake Morgan. The reason why he selected Blake Morgan was because having researched previous cases, SM discovered that there had been three identical cases which had been adjudicated upon by the DC. In one case, where the accountant was not represented, he was excluded from membership. In the other two cases, the accountant had been represented and had not been excluded. The lawyer in each case was now a consultant at Blake Morgan.

On the face of it, the case looked particularly serious. Exclusion from membership was a possibility. However, rarely can it be said that the outcome is inevitable. A strong plea in mitigation was presented to the DC. There was an explanation for SM’s conduct, which the employer had accepted and confirmed in correspondence.

Blake Morgan Consultant, Chris Cope, said:

It had taken four years for the matter to reach the DC. This delay had been stressful to SM, as you can imagine. It's the first thing that comes to mind when waking in the morning. As they say in legal circles, justice delayed is justice denied. None of the delays were SM's responsibility.

There was an issue to be addressed before the DC, namely whether they could fine a member in respect of conduct which occurred when he was a student. There is no power to fine students. If the case had been brought before the DC before SM became a member, there could have been no fine. The DC accepted that a fine would not be appropriate.

The outcome

The decision was a severe reprimand, costs and publicity of name. This was a good outcome.

Needless to say, in serious cases such as this, it makes no sense to appear in person or not appear at all. Legal advice and representation should be seriously considered.

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