NEWS

John McGuinness KC, Paul Sharkey, Natalie McNamee and James Gwatkin

Members of Foundry Chambers prosecute high profile legal costs fraud

John McGuinness KC, Paul Sharkey, Natalie McNamee and James Gwatkin have recently concluded a series of trials at Southwark Crown Court in which a number of defendants were convicted of defrauding HMCTS by falsely claiming millions of pounds’ worth of legal costs.

At the time of the offences in 2011, Defendants who were acquitted in criminal proceedings could apply for a Defendant’s Costs Order (DCO) to compensate them for any legal costs they had incurred. If the Crown Court granted a DCO, an acquitted defendant could make a claim to the National Taxing Team (NTT) of HMCTS to recover those costs.

A number of legal professionals and a costs draftsmen abused this system by submitting vastly inflated claims for legal fees for work that had not been undertaken, through firms of solicitors acting on behalf of acquitted defendants.

Gazi Khan, a costs draftsman, was convicted, between 2019 and 2023,  of five counts of fraud in relation to false claims made under DCOs. Claims totalling £12.6m were made to the NTT in respect of legal costs of acquitted defendants, and approximately £1.43m was paid out to firms of solicitors making the claims. In March 2023, Gazi Khan was sentenced to 5 years’ imprisonment.

Gazi Khan, Azhar Khan, Joseph Kyeremeh (both solicitors) and Rasib Ghaffar (a barrister and Immigration Tribunal Judge) were all convicted of conspiracy to commit fraud by false representation, in relation to claims submitted to the NTT arising out of a case which occurred at Bournemouth Crown Court in 2011. The most recent conviction concerned Rasib Ghaffar in February 2024.

The case that gave rise to the defendants’ dishonest conduct and their convictions arose when a total of six defendants appeared before the Crown Court at Bournemouth. Once it became known in that case that a ‘deal’ was to be done between the prosecution and defence, whereby two defendants would plead guilty and the other four would have their cases dropped, the opportunity for a fraud to be committed arose. As it was known that four of the defendants were to be acquitted, the two defendants who had the benefit of legal aid had that revoked, and two other defendants were transferred to new firms of solicitors shortly before the case concluded, all with a view to claiming large sums in private legal costs. Claims totalling £1.8 million were submitted to the NTT in respect of the four acquitted defendants of which approximately £470,000 was paid out.

In March 2023 Azhar Khan and Joseph Kyeremeh received suspended sentences of imprisonment.

Rasib Ghaffar awaits sentence.

This was a hugely complex case, which spanned seven trials across a five year period (including one trial which was abandoned due to the outbreak of the COVID-19 pandemic).

Members of Chambers were instructed by the Serious Economic Organised Crime and International Directorate (SEOCID) of the Crown Prosecution Service (CPS).

Further information can be found here:

https://www.thetimes.co.uk/article/immigration-judge-faces-jail-over-18m-fake-legal-aid-plot-vq6z8xxzf

https://www.dailymail.co.uk/news/article-13087315/Immigration-judge-teaming-crooked-lawyers-fleece-taxpayer-1-8m-legal-aid-scam.html

https://www.law360.com/articles/1797720/barrister-convicted-of-fraud-in-1-8m-legal-aid-case

https://www.legalfutures.co.uk/latest-news/legal-aid-fraud-trial-stopped-as-barristers-self-isolate

https://www.cps.gov.uk/cps/news/last-group-lawyers-convicted-defrauding-legal-aid-agency