The Lawyer reports that a West End law firm fined £400,000 two years ago for its involvement in a boiler room share scam is being liquidated following a winding-up petition brought by a former employee.
The High Court has ruled that Atlantic Law, which owed over £160,000 to Herbert Smith as recently as 2010, be wound up under the Insolvency Act 1986.
Tim Neale, an official receiver at the Insolvency Service, made the order against the firm on 27 February after former Atlantic Law employee Lindsey Sloan presented a petition to the High Court in December.
Sloan instructed Barclays Taylor director Robert Taylor for legal representation, with no one appearing on Atlantic Law’s behalf.
The Insolvency Service is still working on the case, with at least three employees, including Sloan, understood to be making claims against the firm for unpaid wages. Atlantic Law founding partner Andrew Greystoke could not be reached for comment.
Atlantic Law was fined £400,000 in 2010 after the Financial Services and Markets Tribunal heard that Greystoke approved 50 UK investment advertisements from four unregulated Spanish stockbroking companies between December 2005 and March 2007 (13 May 2010).
It is believed that the firm was effectively a one-partner practice, but Companies House filings show that two other individuals with the surname Greystoke, understood to be the founding partner’s children, were added and removed from the partnership over the past four years, one once and the other twice.
The Porter Street firm entered into a company voluntary arrangement (CVA) in 2010, with Neil Bennett and Michael Healy of recovery specialists Leonard Curtis appointed as supervisers.
Companies House filings show that Herbert Smith was one of nine creditors present in person or in proxy at a creditors’ meeting on 12 April 2010, with the City firm owed £163,170.26.
The West End firm also owed James Sturman QC of 2 Bedford Row just over £24,000 and HM Revenue and Customs £124,999.
The total amount owed to creditors came to over £1m, the filings show.
The Insolvency Service declined to comment on how much of the debt had been repaid following the failed CVA.
Herbert Smith declined to comment. Bennett, Healy and Sturman were not available for comment.