This year’s sad Christmas story is about an accountant. He is a real person called Geoff Long and he became involved in introducing some of his dentist clients to a tax avoidance scheme, Icebreaker. He received an introducer fee or commission from the promoter, which he failed to tell his clients about, and which he funnelled through a company in which he held an undisclosed interest.

When in 2012, the Icebreaker scheme went bad, his clients complained to the Institute of Chartered Accountants in England and Wales , claiming that they had been mis-sold the investments because Long had not told them about the introducer fee.

The report of the disciplinary hearing appears in the December 2017 edition of economia magazine

The tribunal ruled that Long’s failure to disclose the commissions to his clients or seek their consent to his receiving them was a breach of the Institute’s ethical rules, and that there were other breaches as well.

ln reaching its sentencing decision, the tribunal took into account that Long had admitted the most serious complaints relating to undisclosed commission payments and had co-operated with the investigation. He had shown regret for his actions and had apologised to ICAEW.

However, the matters that had been proved against him were very serious.
The interlocking theme running through them was that he disregarded the rules when he did not consider it was to his advantage to follow them. The tribunal was unfortunately left with the impression that his motivation was to maximise his personal gain while minimising or avoiding his personal liabilities. ln doing so, he had blatantly disregarded his duties to his clients and the obligations of his professional status.

Long was excluded from membership of ICAEW, and fined £5,000 with £47,000 costs.

Why is the story sad? Was Long blinded from his obligations towards his clients and his profession by the thought of all that money? Was this a case of collateral damage in a tax avoidance industry which has lost its way, and where selling schemes trumps what is in the client’s best interests? In either case, what a waste.