The writer is a City of London solicitor and an FT contributing editor
This week, a senior minister accused City of London lawyers and other professionals of being “white collar collaborators” with Vladimir Putin’s regime. The foreign secretary boasted of defying lawyers’ letters. A government backbencher went further and “named and shamed” individual lawyers for assisting oligarchs from the former Soviet Union.
Those in government are keen to focus attention on the legal sector and its relationship with Russian money. Journalists are briefed that legal knavery is delaying the implementation of sanctions. Lawyers acting for Russian clients are warned darkly by Whitehall sources that they may be penalised.
The government does have a limited point. Many oligarchs have been represented by skilled and expensive lawyers in their dealings with the government and each other. Russian money has poured into London law firms as well as other parts of the capital’s economy.
However, what they neglect to mention is that ministers initially encouraged lawyers’ pursuit of Russian clients. A decade ago, justice minister Lord McNally urged Russian businesses to make full use of the legal sector. In 2012 the then mayor of London invited London’s oligarchs to sue in the courts of London. That mayor was Boris Johnson.
More recently, legal services were part of post-Brexit Britain’s export strategy, proudly buccaneering on the global stage. But things have now suddenly changed. The pursuit of Russian clients and money is now a Bad Thing — the wrong sort of buccaneering.
This is not to say that lawyers in the City of London are blameless. Many international firms promote their “reputation management” facilities and sanction compliance services to corporations and individuals facing unwelcome scrutiny and media criticism.
And although barristers — the lawyers who specialise in courtroom advocacy — are bound by a “cab rank rule” that means they cannot turn down unsavoury clients, this is not the case with solicitors, who make up the bulk of the legal profession. Solicitors who act for oligarchs do so because they want to, and because it is lucrative.
But focusing on the moral choices made by individual lawyers only goes so far in understanding how oligarchs use and abuse English law. For all their personal faults, lawyers ultimately can only act within the framework provided by the law and the court system. And it is substantive law and procedure that makes London attractive to oligarchs, and not the charms of its advocates.
Take, for example, the law of defamation. Unlike in the US, it is easy for anyone with public prominence to sue and to threaten to sue for libel. Even private corporations can bring a legal suit. And the burden of proof is on the defendant to prove that the disputed statements are true, or honest opinion, or in the public interest. These are features of the law itself so cannot be changed quickly or easily.
A further problem is that English courts do not take freedom of expression as seriously as the rights of claimants. Since the 1998 Human Rights Act took effect, judges have in a sequence of cases “developed” — that is, invented — a law of privacy out of legal thin air. But no similar progress has been made on the free expression rights also supposedly provided for in that legislation.
In theory there are various means by which unmeritorious or vexatious claims can be struck out or penalised. But in practice it is extraordinarily expensive to do anything other than concede to a libel claim at the earliest possible stage. Oligarchs and their lawyers know this, and as a consequence there has been a “libel chill” on reporting about Russian political and business affairs.
But just because a problem can be stated does not mean it can be easily solved. Although there can be tinkering with elements of law and procedure, there is little that can be done about the misuse of defamation and other media laws without fundamental change to the law itself. Everyone — even oligarchs — are entitled to access to lawyers and legal representation.
The government says it will introduce proposals to prevent legal abuses by oligarchs. This is encouraging, but it is difficult to imagine what scope there is for changes which would not affect the rights of those of the non-oligarch majority. In any case, by the time any government proposals are published, the current problems may have gone away. Through their own deft attempts at “reputation management”, many law firms are dropping Russian clients as quickly as possible.
Without meaningful reforms, the same legal opportunities will still be there for other individuals and companies from unpleasant regimes. For although “something must be done”, it is less clear what will be done, or can be done. And so, in lieu of anything significant changing, it will be easier to blame the lawyers instead.
