Don’t get caught in the headlights

April 2, 2018

Teesside law firm Watson Woodhouse Ltd is one of only a handful of North East law firms that holds the prestigious VHCC accreditation that allows it to work on complex and serious fraud cases, which can run into hundreds of millions of pounds. Here, director and head of the Crown Court department, Sean Grainger, speaks to North East Times about the specialist expertise the firm has in this area and reveals why it is essential that companies seek specialist advice as quickly as possible if they learn they’re being investigated by HMRC

Watson Woodhouse is a long-established Middlesbrough-based firm that has carved out a stellar reputation for its legal defence services – ever since James Watson established the firm in 1989 from a one-room office on Cargo Fleet Road in the town.

Now headquartered in a stunning period building on Borough Road – with additional offices in Stockton, Darlington, Northallerton and Harrogate – Watson Woodhouse boasts a workforce of more than 130.

While an acquisition of fellow Teesside law firm, Macks Solicitors, last year has dramatically expanded the legal services Watson Woodhouse can offer clients, the firm is best known for its criminal defence work – in particular, in complex and serious fraud cases.

Watson Woodhouse is one of only a few firms in the North East – and the only based in Middlesbrough – that holds the prestigious VHCC (Very High Cost Case) accreditation.

Sean Grainger, director and head of the Crown Court department, explains: “The VHCC accreditation allows us to work on cases that are listed for trial over 40 days. These are cases of a serious and complex nature – generally high-level fraud brought by HMRC, although they can include drug offences, too.

“You’re not allowed to work on these cases unless you’re on the accredited VHCC panel, as they can represent a very high cost to the legal aid agency and they want to make sure that there are specialist firms working on such cases.”

Sean joined Watson Woodhouse as a trainee back 1994. He qualified as a solicitor when he was 32, after spending his twenties working as a PE and history teacher.

He swapped professions after suffering a catastrophic leg injury playing rugby and, while in hospital, contracted an serious infection because of medical negligence.

Sean, who was unable to return to teaching, worked with a local solicitor and eventually won his medical negligence case after five years. His foray into the legal world led him to study an A Level in law before he undertook a full law degree.

After almost 25 years at Watson Woodhouse, Sean is now a director and partner, who specialises in complex and serious fraud cases.

Sean played an instrumental role in the firm achieving the prestigious VHCC accreditation back in 2005 (when it was first introduced), which allows it to work on top-end fraud cases that can represent hundreds of millions of pounds.

“To gain the accreditation by the Legal Aid Agency, you need to show that you can access specialist counsel and forensic accountants,” Sean explains. “We have this expertise within the firm or have a very good network of specialists we can call on, if required.”

Sean – who reveals he is currently working on a £160 million fraud case – talks about the importance of people seeking specialist legal advice as early as possible once they learn they’re being investigated for fraud.

“People can often get caught in the headlights if they’re involved in these types of investigations,” he says.

“They don’t know what to do but they must seek specialist advice straight away as it’s important to work quickly.”

Sean also reveals that in serious and complex fraud cases, individuals involved can have their personal assets frozen under Section 41 of the Proceeds of Crime Act, restricting them to an income of £250 a week during an investigation which could last two to three years. The powers under the Proceeds of Crime Act 2002 are draconian.

“HMRC and the prosecuting team can apply to a judge for something called an ex parte order to restrain company and or personal assets prior to charge, without the person’s knowledge,” Sean explains.

“Remember, these are high net worth individuals who may have children in private education, restricting them to £250 can make it almost impossible to live.”

He continues: “At Watson Woodhouse, we are experts in releasing funds through applying to vary restraint orders. It’s a very discreet area of law. Most general firms won’t have this expertise but it’s something that we’ve built up over the past 10 years.”

Sean goes on to explain that the firm was recently approached by an individual who was under investigation by HMRC for serious fraud and subject to a restraint order which had been obtained ex parte .

“We applied to vary the order and after a lot of negotiations with some very tough specialist fraud investigators in London, we managed to release funds to allow our client to maintain a reasonable lifestyle,” says Sean.

In another VHCC example, the eight-strong team at Watson Woodhouse – which Sean estimates to represent more than 130 years of legal experience – was able to get the case thrown out of court.

“We had to go through hundreds of thousands of emails but from the evidence we’d managed to extract, the prosecution realised that it was unlikely they would have been able to secure a conviction.”

With HMRC continuing to clamp down on tax fraud, Sean would encourage all companies to take out insurance to protect themselves, should they become subject to an investigation.

Such insurance will not only help with the legal costs associated with a fraud investigation, but it will also allow companies to recruit specialist legal advice at the initial stage.

“If there’s one thing I’ve learnt in my 20-odd years of practicing law it’s that what you say in the first interview is usually the most important piece of evidence at a trial, with the defence and prosecution teams poring over every detail.

“In serious fraud cases, this interview may be years before a charge is brought or you appear in court.

“The first interview is the most important point of the trial process but sometimes the most neglected.

“If Watson Woodhouse is instructed, a senior member of our team, such as myself, will come to the police station and be with you at those interviews – advising you from the very beginning.”

Watson Woodhouse