Thomas Byrne was sentenced yesterday to 12 years in prison. That sentence has been welcomed by me and the Law Society of Ireland.
Thomas Byrne was a devious man. When he sold his clients’ houses he did not pay off the loans owed to the banks on those houses. He simply took the money. In other cases, he acquired multiple loans on properties he owned from various banks without the other banks’ knowledge. He also defrauded several elderly clients whom he had known since he was young. They trusted him and left the deeds of their houses with him for safekeeping. Byrne took those deeds and forged documents to put the houses in his own name. He then took out loans on those houses.
Thomas Byrne’s actions – fraud, theft, forgery – are anathema to me and to every solicitor I know. As the public would expect, the Law Society acted extremely quickly to remove Byrne from practice. In fact, he was shut down faster than any solicitor in our history.
It took just two working days from a whistleblower complaint of forgery being made to us at Blackhall Place on Thursday, October 18th, 2007 to the Law Society completing initial investigations and changing the locks on the doors of Byrne’s practice on Monday, October 22nd, 2007.
The next day, the Law Society applied to the president of the High Court for a number of orders including freezing all bank accounts operated by Thomas Byrne or his firm. We sought, through the High Court, every restriction possible to stop Byrne in his tracks to ensure he would have no more victims. In fact, recognising the seriousness of the case, the president of the High Court granted the freezing order based on oral evidence from the Law Society alone. This is extremely rare and allowed the orders to be granted as quickly as possible.
Files commandeered
The Law Society immediately took possession of Byrne's 3,500 client files and stored them safely and confidentially. Law Society staff contacted Byrne's clients and responded to queries from them, their new solicitors, solicitors on the other side of transactions, banks, and the Criminal Assets Bureau and the Garda Bureau of Fraud Investigation. This work required the acquisition of secure premises and extra staff. We were also required to retain external legal and accountancy services, which cost the Law Society €1.1 million.
Every client of Thomas Byrne who has made a valid claim on the Law Society’s compensation fund has been compensated. The Law Society has paid €7.2 million to victims of Thomas Byrne out of this fund, to which every practising solicitor contributes on an annual basis. This is by far the largest amount the society has had to pay to the clients of a dishonest solicitor.
In total, Thomas Byrne has directly cost the Law Society, and by extension the profession, €8.3 million. But, in truth, he has cost us all a lot more than that.
Solicitors are agents for justice in our society and when an individual such as Thomas Byrne commits such despicable crimes, it is a direct attack on our values and our work. A key role of the Law Society is to protect consumers of legal services from acts of misconduct made by their solicitor.
If a solicitor dishonestly takes money from a client, the Law Society will pay compensation to the client subject to the rules of the statutory compensation scheme. The Law Society prosecutes serious professional misconduct at the independent Solicitors Disciplinary Tribunal, which is appointed by the president of the High Court. In cases of very serious professional misconduct, the Law Society applies to the High Court to prevent the solicitor from working.
Since discovering the crimes of Thomas Byrne, the Law Society has also taken steps to strengthen its own regulations. Byrne fraudulently raised loans by giving undertakings on properties he stated he owned. In 2009, the Law Society implemented statutory instrument 211, which restricts solicitors giving undertakings to financial institutions for their own transactions.
Many of Byrne’s clients were involved in commercial property remortgages, where he failed to clear the initial mortgage after he obtained remortgage funds. In 2010, the Law Society implemented statutory instrument 366, which bans solicitors giving undertakings to financial institutions in commercial property transactions. Now the financial institution would not be able to rely on an undertaking from the borrower’s solicitor to clear an initial mortgage after obtaining remortgaged funds and, therefore, such a fraud should no longer be possible.
Neither the Law Society, nor any other regulator, can know everything that happens in every solicitor’s office. However, we have made it much more difficult for crimes like these to be committed.
Struck off
Following a complex and detailed forensic investigation by the Law Society, and on application of the society, Thomas Byrne was struck off the Roll of Solicitors and ordered to pay a penalty of €1 million by the president of the High Court on June 16th, 2008. The penalty against Byrne remains unpaid.
The overwhelming majority of my solicitor colleagues act ethically. They provide professional and valuable services to their clients. They, like me, are appalled at Byrne and his crimes. The relationship between a solicitor and a client is based on trust. Where that trust is breached, the full force of the law must be brought to bear. This is what has now happened in the case of Thomas Byrne.
John P Shaw is the president of the Law Society of Ireland