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Civil Fraud - do you need to bet the bank?
- AuthorDaniel Dodman
Civil fraud in the City represents a niche within the world of commercial litigation. It is specialised work that sometimes appears to more closely reflect the world of TV legal dramas than standard dispute work. International travel, forensic accountants, personal service, private detectives, asset seizures of yachts/aircraft and key players that are colourful in the extreme often lead to war stories which could rarely come about from a basic contractual dispute.
Although fraud cases are often incredibly varied, they do generally have one thing in common – the amount at stake. Freezing injunctions and the need for full and frank disclosure require serious man hours to bring in front of a Judge. Forensic accountants are as expensive as lawyers and asset tracing and recovery can take time and inevitably add to the overall cost and risk.
Betting the bank
I have worked on some huge fraud claims with damages in the hundreds of millions of pounds and, on these cases, it really is a case of letting slip the dogs of war. Claimants typically have the funds and inclination to track the money to the literal ends of the earth to seek recovery. Defendants face the prospect having their assets frozen for several years and, if they are found liable, an extremely tough existence going forward. By its very nature, this type of litigation forces clients to bet the bank and throw resources at matters in order reach a resolution.
Fast-track freezing orders
But is civil fraud simply the preserve of these kinds of disputes? Are freezing orders only open to companies or individuals with extremely deep pockets?
All the commentary points to the fact that, in this post-covid world of remote working, civil fraud is increasing and it is not limited to the huge cases that form the foundation of civil fraud in the City. Companies and individuals are being defrauded of hundreds of thousands of pounds each day and the support they are given by lawyers is a challenge in itself.
With reduced resources, comes the need to focus on steps that will quickly recover assets for the client. Is it possible to obtain a freezing order? Will that genuinely assist a client? How can we use forensic accountants in a targeted way to keep fees down whilst also identifying the information we need? It is a case of the often (mis) quoted line of “not having the time to write a shorter letter”. The smaller the budget you have to work with, the more you have to work to get a result for the client.
Having litigated a number of cases recently where the damages, although small in the context of traditional City civil fraud matters, were crucial to the clients involved, I wanted to explore the ways in which lawyers can be thinking creatively about Civil fraud. To that end, I am writing a series of articles that will show how we can assist clients who do not have a vault of assets to spend on legal fees by creatively applying the law and technology.
I am also forming a network of like minded fraud professionals so if you have experience in this area then please do get in touch.
Dan Dodman is a litigator with a wealth of experience in high profile, high value cases in both the commercial litigation and financial regulation sectors. He acts on a broad range of disputes, both nationally and internationally for corporate, individual and institutional clients.
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Civil Fraud - Goodman Derrick
The experienced partners in Goodman Derrick's dispute resolution department have built a strong reputation and impressive track record for defending and bringing civil fraud claims.
The team of three specialists, supported by eight lawyers, bring wide ranging experience, covering small claims for SMEs to the very largest and most complex claims, usually involving multiple defendants, often working in tandem with large international firms.
Please visit the Civil Fraud page of our website for further information about our specialist service.
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This guide is for general information and interest only and should not be relied upon as providing specific legal advice.
If you require any further information about the issues raised in this article please contact Dan Dodman .