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EDINBURGH — London law firm Hogan Lovells has been accused of helping Zupta capture state assets. South Africa-born Peter Hain, a former Labour cabinet minister and veteran anti-apartheid campaigner, told the House of Lords earlier this year that he had reported Hogan Lovells to the UK’s Solicitors Regulation Authority, accusing it of producing a “fatally flawed whitewash” report into claims of money laundering at the South African Revenue Service. Hogan Lovells dismissed Hain’s allegations as “unfounded accusations”. As The Guardian told its readers in January, Hain’s claims against Hogan Lovells relate to the firm’s investigation into allegations of corruption against SARS deputy commissioner Jonas Makwakwa, who, along with his lover, was alleged to have siphoned off about R1.7m (£100,000). Makwakwa denied any wrongdoing. Makwakwa and SARS commissioner Tom Moyane were accused of the “dirty work of robbing taxpayers”. Hain called on the SRA to withdraw Hogan Lovells from the solicitors trade body and consider withdrawing its partners’ permission to practise as solicitors. But the SRA has washed its hands of the matter, claiming that the South African branch of the law firm is merely using the London branch’s name for branding purposes. It looks like the London legal hotshots have wriggled out of being punished for complicity in industrial scale corruption that brought South Africa to its knees – on a technicality. – Jackie Cameron
Peter Hain‘s response:
Thank you for examining the material I sent through in different tranches asking for Hogan Lovells to be suspended and its Senior Partners barred from practising in the UK.
However you will be unsurprised to learn that I am extremely disappointed with the outcome.
Hogan Lovells UK have managed through a procedural body-swerve to avoid culpability because, according to the SRA, it ‘does not control’ Hogan Lovells SA and is linked only as ‘essentially a branding exercise’. This seems to me plain legal sophistry which brings an international law firm like Hogan Lovells into even greater disrepute, adding to their terrible reputation for whitewashing corruption and money laundering in the South African Revenue Service.
It seems to me that the SRA is simply standing by and allowing Hogan Lovells to slip through your investigative loopholes which does legal regulation in the UK no credit at all.
I will be pursuing this matter of lax UK solicitor regulation when Parliament resumes in the Autumn.
Paul O’Sullivan‘s response:
Further to your attached communication to Lord Hain. I consider same to be an official ‘endorsement’ of low ethics in the legal fraternity which the Solicitors Regulation Authority is supposed to ‘regulate’.
Forensics for Justice is a South African charity that focusses on exposing and holding people accountable for corruption in South Africa.
For your information it was clients of Hogan Lovells (with the knowledge of Hogan Lovells) that had me kidnapped and tortured, for no other reason than to prevent me from exposing the corruption that we call State Capture, which nearly brought this country to its knees, but made millions in fees for Hogan Lovells. I therefore have an interest in the matter and can confirm that we have previously assisted Lord Hain, by providing him with information of wrong doing by Hogan Lovells ‘brand’ (as you call it) in South Africa. Hogan Lovells banked millions of Rand of tax-payer funds for their role in State Capture, which included keeping criminals in their jobs to commit further serious crimes.
I wish to enquire about the following: https://www.sra.org.uk/solicitors/handbook/overseasrules/content.page
Overseas Principle 2: You must act with integrity.
Personal integrity is central to your role as the client’s trusted adviser and should characterise all of your professional dealings with clients, the court, other lawyers and the public, wherever they are being conducted. You should use your judgment when considering how best to maintain your integrity at all times and avoid any behaviour outside England and Wales which undermines your character and suitability to be an authorised person. A responsible authorised body should ensure that its overseas practices observe comparable standards.
Overseas Principle 3: You must not allow your independence or the independence of your overseas practice to be compromised.
“Independence” means your own independence and that of your firm and your overseas practice, and not merely your ability to give independent advice to a client. You should avoid giving control of your overseas practice to a third party beyond any local legal or regulatory ownership requirements.
May I be so bold as to ask if you have considered these rules in your response to me, since the South African arm of Hogan Lovells appear to be trading off what you describe as a ‘branding exercise’?
If you have considered same, perhaps you can explain why the above rules don’t apply in this instance?
Does it mean that a UK law firm can act in another country with impunity, by using a ‘branding’ set up?
Did you ask the question whether any ‘benefit’ is derived in the hands of the London of Hogan Lovells for the use of their brand in South Africa?
If Hogan Lovells outside of South Africa, received any benefit for the crimes of Hogan Lovells inside South Africa, then surely that would make them accountable?
I am sorry to trouble you with this so late, but would seek clarity, in view of the fact that I will be requesting Lord Hain to continue to apply public pressure on both Hogan Lovells and, now, the Solicitors Regulation Authority.
I do recall pointing out to the SRA two years ago how another well-known London law firm was complicit in cash transfers of in excess of USD500,000 which were used to bribe then corrupt ministers in Liberia, by a London based mining company. Curiously, although the owner of law firm in Liberia to whom the well-known London law firm sent the funds, were indicted, along with the corrupt ministers, the SRA chose to let them off the hook.
I must say, I am left to believe that the SRA are not using their rules to hold reticent lawyers accountable and as such, do the public a disservice.
A group of discontent South Africans in London will shortly be embarking on a campaign to expose the low ethics of UK based firms Hogan Lovells and McKinsey. They are forced to this action, in the case of Hogan Lovells, as a result of the complete failure of the UK’s Solicitors Regulation Authority to bring them to book.
I therefore request you to reopen your enquiry and hold these people accountable for their conduct and to pay back the fees they earned.
Hogan Lovells response:
The Solicitors Regulation Authority (SRA) has confirmed that it does not intend to take any regulatory action against Hogan Lovells International LLP in relation to a complaint made by Lord Peter Hain in January of this year.
The peer has made a series of statements against the firm in the House of Lords in January this year which claimed that Hogan Lovells in South Africa had been complicit in supporting corruption in that country through its work for the South African Revenue Service (SARS).
We have consistently rejected the allegations made by Lord Hain as simply being demonstrably untrue and was reported in detail in BizNews on 23 January in our report ‘Sunlight over shadow’. You can read a copy of the SARS report for yourselves in what was published by the South African parliament and our op-ed in BizNews goes in to the full details and context, and was published in May.
This and always has been a piece of work carried out in South Africa for a South African client by South African qualified lawyers and we are pleased that the SRA, with whom we have fully co-operated, agrees with this.
The appropriate forum for resolving any dispute is and always has been in South Africa with the Law Society of the Northern Provinces. We proactively brought this matter to their attention when Lord Hain raised his complaint and we are working closely with them. In addition, the chair of our practice in South Africa has twice given evidence to the South African parliament and fully accounted for the work that we undertook.
We understand the need for transparency and we are very happy for our work to be scrutinised by the appropriate and authorities. We remain committed to supporting investment in South Africa at this time and to continuing to contribute locally to our capacity building and pro bono programmes in collaboration with other key stakeholders.