DISCIPLINARY COMMITTEE OF THE ASSOCIATION OF CHARTERED CERTIFIED ACCOUNTANTS

Transcription

1 DISCIPLINARY COMMITTEE OF THE ASSOCIATION OF CHARTERED CERTIFIED ACCOUNTANTS REASONS FOR DECISION In the matter of: Optima Business Support Services Limited Heard on: 28 August 2015 Location: Committee: Legal Adviser: Persons present and capacity: ACCA s Offices, 29 Lincoln s Inn Fields, London, WC2A 3EE Mrs Lubna Shuja (Chairman), Mr William Hay (Accountant) and Mrs Eileen Skinner (Lay) Mr Conor Heaney Ms Kayleigh Long (Case Presenter on behalf of ACCA) and Ms Jill Baldwin (Committee Officer ACCA); Mr Ayomide Oluseum Otubanjo on behalf of Optima Business Support Services Limited (by telephone) 1. The Committee had before it a hearing bundle comprising pages A-F and It also had a service bundle comprising pages ACCA was represented by Ms Long, Case Presenter. Mr Otubanjo participated in the proceedings by way of a live telephone link. ALLEGATION/BRIEF BACKGROUND 2. The Committee convened to consider one allegation as follows: Allegation 1 Pursuant to bye-law 8(a)(viii) Optima Business Support Services Limited is liable to disciplinary action in that it failed to satisfy a judgment debt without reasonable excuse for a period of two months or more in respect of Claim Number 3QT77388 in the Chelmsford County Court dated 5 March 2014.

2 3. Optima Business Support Services Limited (Optima) is an ACCA member firm. Copies of Annual Returns for Optima dated 5 January 2013 and 5 January 2014 record that Mr Otubanjo is the sole director and principal shareholder. 4. Company B entered into a telemarketing agreement with Optima on 18 December The agreement was signed on behalf of Optima by Mr Otubanjo. The Committee heard that Company B carried out telemarketing and provided an inbound response line for Optima. Invoices were raised for work done by Company B on 14 January, 20 March and 26 April It was alleged that despite numerous attempts to obtain payment from Optima for these invoices, no payment was forthcoming. As a result, Company B issued proceedings against Optima and obtained a County Court judgment dated 5 March 2014 for the value of the unpaid invoices, interest and costs in the sum of 3, It was ordered that Optima pay all monies owed on or before 19 March Company B subsequently submitted a complaint to ACCA. The judgment remained outstanding. Submissions 5. Ms Long on behalf of ACCA explained that Optima had lodged an application in June 2014 to set aside the judgment obtained in Company B s favour. This application was considered by the County Court on 22 August 2014 and dismissed. Ms Long submitted that the judgment still stands against Optima and has not been paid. 6. Ms Long further submitted that almost 18 months had passed since the judgment against Optima had been obtained. A year had passed since Optima s unsuccessful application to set the judgment aside. 7. Ms Long contended that no reasonable excuse for not paying the debt had been advanced to the Committee and the mere fact that Mr Otubanjo was dissatisfied with the outcome of the legal proceedings did not amount to a reasonable excuse for not satisfying the judgment debt. Ms Long concluded her submission by submitting that refusing to satisfy the judgment debt lawfully obtained was not conduct becoming of an accountancy firm.

3 8. Mr Otubanjo explained that Optima engaged Company B to carry out a telemarketing campaign. Mr Otubanjo told the Committee that he had made numerous complaints to Company B about the standard of service provided. He tried to come to an arrangement with Company B before proceedings were issued as to the amount to be repaid and afterwards in order to satisfy the judgment debt. Mr Otubanjo said that Company B had refused to reach an agreement with Optima and had instead decided to refer a complaint to ACCA. 9. Mr Otubanjo was critical of the way the case had been handled by the Court describing it as chaotic. Mr Otubanjo confirmed the outstanding judgment had still not been paid. He confirmed that Optima was no longer trading and that its practising certificate had not been renewed for DECISION ON FACTS AND ALLEGATION 10. The Committee listened carefully to the parties submissions, considered all the documents and accepted the advice of the Legal Adviser. 11. The Committee noted Mr Otubanjo s acceptance that there was a lawful judgment debt against Optima which had still not been paid. The Committee also had regard to bye-law 8(g) which provided that any finding of fact in any civil proceedings before a court of competent jurisdiction shall be admissible as prima facie evidence in any disciplinary proceedings. The Committee had regard to the judgment confirmed in the order of the County Court sitting at Chelmsford in favour of Company B dated 5 March 2014 and the order of the same Court on 22 August 2014, in which Optima s application to set aside the judgment debt was dismissed. The Committee was satisfied that both Orders were prima facie evidence that Optima was lawfully required to pay the sum sought by Company B in the sum of 3, The Committee then turned to address the question of whether Mr Otubanjo had advanced a reasonable excuse for not paying the monies owed to Company B. The Committee considered Mr Otubanjo s arguments in this regard very carefully. The Committee was not persuaded that Mr Otubanjo s stated dissatisfaction with the services provided to Optima could amount, on the balance of probabilities, to a reasonable excuse. The Committee was

4 satisfied that Mr Otubanjo s submissions amounted to an attempt to rehearse arguments which had been previously considered and rejected by the County Court and could not be said to provide a basis upon which to lawfully refuse to honour the judgment against Optima. 13. The Committee had no written evidence of Optima s financial position and noted Mr Otubanjo s submission that it had no money to pay the sum adjudged to be paid. The Committee also heard from Mr Otubanjo that he was now working as a CEO in a healthcare company in Nigeria and had intended to put Optima into a creditors voluntary liquidation. The Committee noted that Mr Otubanjo last had contact with Company B in March/April 2014 but had made no effort to enter into a repayment arrangement with Company B over a period of 12 months since August 2014, by way of part payment or instalments. 14. For the reasons given, the Committee found the allegation proved. SANCTION 15. The Committee upon inviting him to do so, heard no specific submission from Mr Otubanjo on which, if any, sanction to impose. He repeated the difficult financial circumstances of the company and the likelihood that it will be placed into voluntary liquidation. 16. The Committee first considered the mitigating factors in the case and identified the following: The complaint giving rise to the referral was an isolated event albeit continuing over a period of time; Mr Otubanjo had cooperated with ACCA; Optima had a previous good record. 17. The Committee next turned to the aggravating features in the case and identified the following: There was no evidence of insight on Mr Otubanjo s part and no remorse for the actions of his company which had resulted in a financial loss to a third party;

5 The company had engaged in a deliberate action over a long period of time and no indication was forthcoming from Mr Otubanjo that he had any intention to remedy the position and repay the money owed by Optima, even by way of instalments. 18. The Committee had regard to the Guidance for Disciplinary Sanctions issued by ACCA. The Committee considered that the facts found proved in this case were serious. The Committee was not persuaded that this was an appropriate case in which to take no further action or order that Optima be Admonished. 19. The Committee was also not satisfied that a Reprimand would be a proportionate response in this case. Such a sanction would only be considered to be appropriate where the conduct complained of was deemed to be minor, which was not the judgment of the Committee in this case. In addition, there was no evidence of insight and there was clear evidence that Optima engaged in a deliberate action in not paying the debt lawfully owed which had caused loss to a third party. 20. The Committee then considered a Severe Reprimand. The Committee had no evidence of any previous adverse disciplinary finding against the company and noted that as its sole director, Mr Otubanjo had cooperated and engaged with ACCA in the regulatory process. There was clear evidence that the actions of Optima were serious for the reasons given above and that there was a lack of insight. There was evidence that Optima s actions had caused financial harm to a third party which, as a result of its deliberate refusal to pay the money owed, was continuing. 21. The Committee was satisfied that the public interest, which included the need to declare and uphold proper standards of conduct and performance, could only adequately be safeguarded by imposing a Severe Reprimand in this case. COSTS 22. ACCA claimed costs in the sum of 1, Mr Otubanjo had no submission to make on behalf of Optima. The Committee was satisfied that

6 the sum claimed was fair and reasonable and ordered that Optima pay ACCA s costs as claimed. EFFECTIVE DATE OF ORDER 23. This order shall take effect from the date of the expiry of the appeal period unless Optima gives notice of appeal prior to the expiry of that period, in which case it shall become effective (if at all) as described in the Appeal Regulations. PUBLICITY 24. ACCA s regulations require ACCA to publish the Committee s findings and orders by way of a press release naming the relevant person as soon as practicable. The Committee has a discretion as to which publications the press release should be sent, and a discretion in exceptional circumstances to direct that the relevant person is not named. Mr Otubanjo did not make any submissions in relation to exceptional circumstances and the Committee did not identify any. Accordingly, the Committee ordered that a press release should be issued to ACCA s website and to the company s local press, referring to Optima by name. Mrs Lubna Shuja Chairman 28 August 2015