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Pomerantz Law Firm Reminds Shareholders with Losses on their Investment in General Motors Company of Class Action Lawsuit and Upcoming Deadline – GM

NEW YORK, NY / ACCESSWIRE / July 23, 2017 / Pomerantz LLP announces that a class action lawsuit has been filed against General Motor Company (“GM” or the “Company”) (NYSE: GM) and certain of its officers. The class action, filed in United States District Court, Eastern District of Michigan, and docketed under 17-cv-12185, is on behalf of a class consisting of investors who purchased or otherwise acquired GM securities, seeking to recover compensable damages caused by defendants’ violations of the Securities Exchange Act of 1934.

If you are a shareholder who purchased GM securities between February 27, 2012 and May 24, 2017, both dates inclusive, you have until July 26, 2017 to ask the Court to appoint you as Lead Plaintiff for the class. A copy of the Complaint can be obtained at www.pomerantzlaw.com. To discuss this action, contact Robert S. Willoughby at rswilloughby@pomlaw.com or 888.476.6529 (or 888.4-POMLAW), toll free, ext. 9980. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and number of shares purchased.

[Click here to join this class action]

General Motors Company designs, builds, and sells cars, trucks, crossovers, and automobile parts. The Company offers vehicle protection, parts, accessories, maintenance, satellite radio, and automotive financing. General Motors provides its vehicles and services worldwide.

Complaint alleges that throughout the Class Period, Defendants made materially false and misleading statements regarding the Company’s business, operational and compliance policies. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) the Company installed at least three distinct defeat devices in over 700,000 trucks with Duramax diesel engines from 2011 to 2016 in order to cheat emissions tests in the U.S.; (ii) consequently, the GM trucks at issue emit up to five times the legal limit of nitrogen oxide pollutants; and (iii) as a result of the foregoing, GM’s public statements were materially false and misleading at all relevant times.

On May 25, 2017, Bloomberg reported that a consumer lawsuit had been filed against GM for installing multiple defeat devices in two models of heavy-duty trucks with the Duramax diesel engine from 2011-2016. The lawsuit alleges that GM’s unlawful, unfair, deceptive, and otherwise defective emission controls affect model year 2011-2016 GM Sierra 2500HD and 3500 HD trucks and GM Silverado 2500 HD and 3500 HD trucks. According to the lawsuit, extensive testing of a 2013 Silverado 2500 diesel – a vehicle representative of the class of Duramax diesel engines present in both the Chevrolet Silverado and GMC Sierra model years 2011 to 2016 – indicated as follows: (1) the vehicle produces emissions above the certification tests at temperatures above the certification range (86ºF); (2) the vehicle produces higher emissions when temperatures are below the certification test range (68ºF); and (3) the vehicle produces higher emissions occur after the vehicle has been run for 200-500 seconds of steady speed operation on average by a factor of 4.5 in all temperature windows. These test results confirmed the presence of three distinct defeat devices, which enable the vehicle to meet emissions standards in the test temperature range, while allowing two to five times the legal amount of nitrogen-oxide pollutants to be emitted at all other times.

On this news, GM’s share price fell $0.60, or 1.81%, to close at $32.60 on May 25, 2017.

The Pomerantz Firm, with offices in New York, Chicago, Florida, and Los Angeles, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 80 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomerantzlaw.com.

SOURCE: Pomerantz LLP


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Tread carefully on proposal to exempt small, medium firms from audits: SME Corp CEO

PETALING JAYA: The proposal to apply the audit exemption provision in the Companies Act 2016 on small and medium companies has to be treated cautiously as there are a few possible drawbacks to SMEs, according to SME Corp Malaysia.

Its CEO Datuk Dr Hafsah Hashim (pix) said SMEs may not be able to maintain proper accounting records, hence there is a need for an annual audit so that SMEs can have access to an independent finance professional.

“Not many SMEs have in-house accounting professionals, so the mandatory annual audit can assist such companies,” she told SunBiz in an email interview.

The compulsory annual audit, which may be exempted in the Act, will also deter fraud and protect the directors of such SMEs so that there is less risk of sanctions for failure to maintain proper accounting records.

“If the annual audit is removed, ad-hoc audits may still be required for funding or financing purposes. Such ad-hoc audits may be expensive,” Hafsah added.

She said doing away with annual audits for small companies would also have an impact on the submission of tax returns since the submission process requires the audited accounts. When banks extend financing or loans, the banks would also want to have a copy of the audited accounts.

In addition, there will be an impact on the accounting profession, as many accountants will see a drastic reduction in their audit revenue. Audits of small companies provide a training ground for fresh accountants. About 78% of the accountants who responded to a survey stated that they do not have any strategy to cope with any possible audit exemption.

On the bright side, Hafsah said audit exemption for dormant companies and small private companies will allow start-ups and SMEs to enjoy cost savings as they will no longer need to appoint auditors to audit their accounts.

“Overall, the amendments of the Companies Act 2016 are positive and supportive of businesses particularly SMEs in the country. The Act will lower costs and improve ease of doing business for SMEs by introducing a single electronic template for incorporation of companies, allowing a single shareholder and director, waiver of AGM and exemption of audits for dormant and small companies.”

SME Corp and the Malaysian Institute of Accountants have declined to comment further on the progress of the proposed audit exemption in the Act, as it is under the purview of the Companies Commission of Malaysia (SSM).

An SSM spokesperson said it has looked at the feedback on the proposed audit exemption for SMEs. “SSM is preparing a Practice Note on the issue and will be releasing it for the public’s information,” the spokesperson told SunBiz.

According to the SSM’s website, under Section 255 (3) of the Companies Act 2016, the registrar may exempt certain classes of companies from compliance with requirements on financial statements. The categories for such exemptions are yet to be released.

SSM said, generally, the law requires every company to appoint an auditor for each financial year. However, under Section 267(2) of the Companies Act 2016, the registrar is empowered to exempt certain categories of private companies from having to appoint an auditor for a financial year.

“However, the registrar has yet to invoke this provision and, therefore, the audit requirement is still mandatory for all companies,” SSM said in its Frequently Asked Questions section.

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A Look at UAE’s New Bankruptcy Law: How It Works, What It Means and Why It’s Good News

The absence of a legal framework for bankruptcy has long been a hindrance to UAE businesses. Not anymore. (Shutterstock)

The absence of a legal framework for bankruptcy has long been a hindrance to UAE businesses. Not anymore. (Shutterstock)

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The absence of a legal framework for bankruptcy has long been a hindrance to UAE business.

In the past, financial problems spelled trouble for companies, as local courts could not be persuaded to offer a moratorium on debt, which would have given firms the chance to restructure their business and finance. In the absence of proper bankruptcy laws, even a bounced cheque could land an entrepreneur in jail.

It comes as no surprise, therefore, that the introduction of a new bankruptcy law in the UAE is being lauded as a huge step forward in improving the country’s economic and regulatory environment. But what does this law really mean?

What is the new bankruptcy law?

The Federal Bankruptcy Law (the ‘New Law’) was issued under the Federal Decree No 9 of 2016. It was first published in the Official Gazette on September 29, 2016 and came into force on December 29, 2016. Drafted by the Ministry of Finance, it marks a new step forward in providing a legal framework to help distressed companies in the UAE avoid bankruptcy and liquidation.

To whom does the law apply?

The new law applies to companies and not individuals. It applies to companies that are partly or fully owned by the federal or the local government and companies and institutions established in Dubai mainland and free zones that are not governed by existing bankruptcy provisions.

It does not apply to companies established and operating within the Dubai International Financial Centre and Abu Dhabi Global Market as these financial free zones have internal legislation in place regarding bankruptcy and insolvency.

How will it help?

The New Law will do much to enhance the credit dynamics of the UAE economy. It is hoped that it will facilitate more predictability and enable a legal framework to restructure or liquidate distressed businesses. This will increase investor confidence and be of great value to SMEs who have long been in need of legislature that offers them greater stability.

What are the law’s key points?

Determining insolvency: Criteria for evaluating when a company in insolvent has been put into action. This ‘balance sheet’ test determines if the assets of a business are sufficient to cover its liabilities. This will be favourable in encouraging debtors facing difficulties to reach out for help to restructure at an early stage.

A new regulatory body: The Committee of Financial Restructuring (CFR) will maintain an approved list of experts in the field of financial restructuring. It will also administrate a register of insolvencies.

Disqualification: A disqualification system – similar to that found in English insolvency law – has been introduced. Directors found guilty of bankruptcy-connected offences may be disqualified from playing any role connected with the administration of a company for up to five years and may also be subject to fines.

Filing bankruptcy: This must be made if a company is in a state of ‘cessation of payments’ of due and payable debts, or in a state of ‘over-indebtedness’ – in either case for 30 consecutive business days. A creditor may also petition for a company’s bankruptcy if a statutory demand of Dhs100,000 (minimum) has been served, and has remained unpaid for 30 consecutive business days. Finally, the court or a regulator may also initiate bankruptcy proceedings.

The law proposes routes for insolvency assistance

The new law offers several paths to assist companies facing financial difficulties.

Insolvency with restructuring: The company’s debts are restructured with creditor approval. This process is overseen by the courts. A period of five years (extendable by a further three years) is allowed for implementation.

Protective composition: A debtor-led, court-sponsored process, this facilitates the rescue of a business that is in financial difficulty but not yet insolvent. It requires the approval of the unsecured creditors (a majority in number and two-thirds by value). This must occur within three years of court approval but can be extended three years more with creditor approval.

Insolvency and liquidation: This occurs if a protective composition or restructuring scheme is inappropriate, not approved or terminated. The law includes specific time limits for making filings and lodging objections. A trustee must be appointed to oversee the process.

New financing: This can be sought following a protective composition or restructuring scheme. Safeguards are in place for existing secured creditors.

Could company members be liable in any way?

Given that the New Law only came into effect in December 2016, the time scale of proceedings means there are no precedents in regard to the way in which the law shall be applied by the courts. A primary concern, however, is the extent to which liability could pass to individual members such as directors and/or general managers.

The Commercial Companies Law makes clear that a limited liability company has a distinct and separate legal identity to that of its members and is responsible for its own debts. Any debt collection, insolvency or other case must therefore be brought against the company itself, rather than against any member. As a result, many company members consider their liability to consist of paid-up share capital only. After that the company is expected to absorb any and all financial liability incurred.

However, a Court of Cassation Decision judgement in 2013 held that a shareholder will be held personally liable should he exploit the principle of a company’s independent liability as a means to conceal his fraudulent acts and/or misappropriation of company funds. In such cases, the protection bestowed by law for a shareholder in a limited liability company was deemed not to apply. Rather, the said shareholder will be held liable in his personal capacity for such dispositions, and his liability extended to include his personal assets.

This concept of personal liability is expressly included in the New Law under Article 198, which provides that “directors of the board, managers and those in charge of liquidation of the company” shall be sentenced to a maximum term of five years’ imprisonment and a fine of no more than Dhs1m in the event that they hide information / conceal finances / embezzle funds / admit to debts which are not owed by the company.

To some extent, UAE law already catered for such a situation by way of the Commercial Transactions Law – however the fact that the New Law reaffirms the position and codifies the 2013 Court of Cassation judgement would suggest that the corporate veil should no longer offer automatic protection.

In recent times, the position of a company’s general manager has also become precarious in the event that the company has become ‘insolvent’ (in the general sense of the word). This is particularly the case in instances whereby the company has insufficient funds to cover any cheques that have been issued, given that bounced cheques issued by companies can incur criminal liability upon the signatory directly. However, Article 162 of the New Law now provides that further to the court accepting a voluntary application for bankruptcy (i.e. without litigation) pursuant to Article 78 thereof, and until such a time that any restructuring scheme has been approved as per Article 108, all judicial claims and proceedings shall be suspended. This shall include any action for bounced cheques.

The idea is to encourage companies in financial difficulty to approach the courts for assistance with restructuring debt. The availability of this option is to discourage company members from absconding and leaving creditors with no means of recovery. However, the fact that this option has been introduced imposes the risk of an alternative liability.

Now, in the event that a company does not apply for bankruptcy upon meeting the criteria prescribed by Article 68 of the New Law (i.e. that it ceases repayment of a mature debt for more than 30 consecutive business days on account of its financial position), the provisions of Article 162(1) of the Commercial Companies Law may be deemed as applicable: “Members of the board of directors shall be liable towards the company, shareholders and third parties for fraudulent acts and misuse of power, as well as for any violation of the law, Company’s AOA and mismanagement.”

As a result, directors or managers may be held accountable for mismanagement – an act for which Article 84(1) of the Commercial Companies Law holds individuals personally liable.

Conclusion

Ultimately the new law is a positive development in the UAE, especially given the fact that the UAE Vision 2021 sets a firm target to make the UAE ‘the world’s first in ease of doing business’.

Nonetheless, the proof will be in the pudding, and there will need to be real evidence of improvement in terms of time to resolve insolvency, cost of insolvency to debtors, and recovery rates. Furthermore, effects upon the individual members of any companies undergoing bankruptcy proceedings will require clarification in order to achieve the aim of encouraging distressed companies to apply.

Practically speaking, and according to the World Bank report, resolving insolvency in the UAE costs 20 per cent of debtors’ estate and yields an average recovery of about 29 cents on the dollar. This legislature therefore offers the potential for marked improvement. The removal of the criminal offence of bankruptcy by default, the provisions in relation to bounced cheques and the new threshold and requirements for creditor-initiated insolvency proceedings will be of help to thousands of UAE businesses, especially SMEs, which are the backbone to the UAE economy.

Nonetheless, this relatively new law is complex. Therefore, when it comes to insolvency, businesses and individuals would be best advised to seek out a good insolvency expertise and informed legal advice. Directors of UAE companies would be wise to react promptly to any sign of financial decline and seeking legal counsel early on will mean that they can mitigate risk and be guided in taking advantage of the new options offered in this new legislation.

By Cynthia Trench

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Boom in convenience seen as firms gear up for Olympic profits

Japanese companies are accelerating preparations to seize Olympic business opportunities to ensure money will keep rolling in after the quadrennial sporting spectacle ends in 2020.

“The mission for the business community is to realize the expected economic effects,” said Sadayuki Sakakibara, chairman of the Japan Business Federation (Keidanren), the nation’s largest business lobby.

Many of the businesses are focusing on new services that can increase convenience.

In the telecommunications industry, for example, testing is underway to showcase a fifth-generation wireless technology dubbed 5G that boasts higher speed and data transmission capacity.

The 5G Wi-Fi advance is expected to be the main technology for distributing high-definition broadcasts and communications services in every aspect of life, including when traveling, industry sources said.

In the lodging industry, supply and demand for rooms is expected to get even tighter for the 2020 Games. This has prompted an increasing number of companies to jump into the minpaku (private lodging) sector, Japan’s version of the room rental services provided by websites like Airbnb.

After the Diet enacted a law on minpaku regulations in June, cybermall Rakuten Inc. announced last month that it would launch minpaku operations as early as January.

“We want to provide innovative services designed to connect people aiming to offer accommodation facilities with those hoping to utilize them,” a Rakuten official said.

Apartment chain Leopalace21 Corp. is also considering a minpaku project.

But the hotel industry is looking to capitalize as well.

Last year, Prince Hotels Inc. rebuilt the venerable Grand Prince Hotel Akasaka, formerly known as the Akasaka Prince, and plans to renovate eight additional Tokyo properties by 2020. In fiscal 2019, it plans to open a more reasonably chain under the Prince Smart Inn brand, charging ¥10,000 per night.

In the transportation industry, meanwhile, the number of van taxis is expected to jump as the Tokyo Hire-Taxi Association moves to replace 10,000 of its roughly 30,000 standard cabs in Tokyo with vehicles that can accommodate groups.

The railways are also boosting efforts by improving barrier-free access and locker services.

Last year, Tokyo Metro Co. began offering temporary storage services for big suitcases that won’t fit in the subway stations’ coin-operated lockers. Given the strong demand, Tokyo Metro is now considering making it a permanent service, an official said.

In the booming realm of big data, Nippon Telegraph and Telephone Corp. group plans to collect and analyze reams of data on foreign visitors, including information on how they move around the city, for “wider use.”

More izakaya (traditional pubs) are meanwhile expected to introduce new smartphone-based payment services by the time the Olympics start.

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drags 7 firms to NCLT for insolvency

Indian Bank has filed cases at the National Company Law Tribunal in seven bad loan cases involving an amount of Rs 1,200 crore, under the Insolvency and Bankruptcy Code (IBC).
Indian Bank has filed cases at the National Company Law Tribunal in seven bad loan cases involving an amount of Rs 1,200 crore, under the Insolvency and Bankruptcy Code (IBC).

Indian Bank is the sole lender in all cases. The bank made a provision of Rs 130 crore in the first quarter of the current financial year and it planned to make a provision of Rs 365 crore for the whole year for these accounts, Kishor Kharat, MD and CEO, said to a leading news agency.

Indian Bank offers deposits, loans and services. The bank’s segments include Treasury, Corporate/Wholesale Banking, Retail Banking and Other Banking Operations.

The company offers products under various categories, including agriculture, corporates, personal/individual, business, professional self-employed etc.

(c) 2017India Infoline Ltd. All rights Reserved. Provided by SyndiGate Media Inc. (Syndigate.info)., source Middle East & North African Newspapers


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FIRS hammers firms over N2b tax default

The Federal Inland Revenue Service (FIRS) at the weekend continued its crackdown on tax-defaulting companies in Abuja, The Nation was reliably informed.

The Nation gathered that the FIRS enforcement team, led by Zubairu Usman, sealed the offices of Dayak Nigeria Limited located at Idu Industrial Layout in Area One part of the city. The company has a Value Added Tax liability of N41,535,829.47 owed between 2013 and 2016.

However, R.T Communications, with a tax liability of N106,408,475.00, could not be located due to its use of a fake address.

Ceezali Limited located at Thaba Tseka Street, thought to owe N14,603,941.00, presented evidence of payment and was not sealed.

Earlier in the week, the FIRS shut Ace Products and Services located at Limited 20, Sanni Ashimu Close, Ologun Bus stop, Awoyaya, Lagos over a tax debt of N157.562 million.

On Tuesday, the team sealed off Finchglow Travels Agency at 25 Ademola Street, Ikoyi, Lagos, over a tax debt of N30.553 million. Other firms sealed include Westcom Technologies at 18 A,Onikepo Akande Street, Lekki Phase 1, Lagos, over a tax debt of N25.978 million and Globasure Technologies Limited at Plot 10B2, Lekki Phase 1, Lagos which owed a tax debt of N34.572 million.

On Monday, four companies in Lagos and Port Harcourt were shut over their failure to meet their tax obligations totalling N630 million.

The affected firms comprised Charcoal and Spices Restaurant Limited, GRA, Port Harcourt, and Cioscon Nigerian Limited at 14 Aba Road, Port Harcourt.

The leader of the FIRS enforcement team, Mrs. Anita Erinne, sealed both companies after showing a warrant of distraint to officials of the company.

Charcoal and Spices Restaurant Limited owes N12,388,979.50 tax debt while Cioscon Nigerian Ltd has a tax liability amounting to N479,203,464.43 from 2014 to 2016 which the firm has failed to remit.

Erinne told the defaulting firms that the companies’ premises will be unsealed when they clear their outstanding tax bills.

She warned the workers not to unseal or tamper with the FIRS seal until the debts are cleared, stating that any attempt to remove the seals will be a contravention of the law.

Erinne, however, noted that the firms have been officially notified of their indebtedness to FIRS, stating that all the companies’ taxes should be paid before their premises could be unsealed.

In Lagos, the enforcement team of the FIRS sealed Joza Global Service situated at 18, Ribadu Road, Ikoyi, Lagos over a tax debt of over N30.6 million. The FIRS team also sealed-off Spog Petrochemicals Limited situated at 50d, Glover Road, Ikoyi, Lagos over a tax debt of N105.5 million.


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Ministers ‘undermined law’ over war crimes claims

Harriet Harman demands Ministry of Justice publish emails that may reveal it pressured law watchdog to act against Iraqi abuse lawyers

Harriet Harman says the government exchanged ‘wholly inappropriate’ emails with the Solicitors Regulation Authority.



Harriet Harman says the government exchanged ‘wholly inappropriate’ emails with the Solicitors Regulation Authority.
Photograph: Natasha Quarmby/REX/Shutterstock

Ministers ‘undermined law’ over Iraq war crimes allegations

Harriet Harman demands Ministry of Justice publish emails that may reveal it pressured law watchdog to act against Iraqi abuse lawyers

The government has been accused of undermining the rule of law by putting pressure on an independent regulator in its action against a legal firm pursuing claims of human rights abuses involving British troops in Iraq.

The former deputy leader of the Labour party, Harriet Harman, has called for the release of any emails that would reveal whether the ministries of justice and defence attempted to influence the Solicitors Regulation Authority (SRA) to act against Leigh Day. The human rights firm has been involved in many high-profile cases against British soldiers and has referred a number of them to the controversial Iraq Historic Allegations Team (IHAT), now being wound up.

Earlier this year, the firm, two of its senior partners, Martyn Day and Sapna Malik, and a junior lawyer, were cleared by the Solicitors Disciplinary Tribunal of any wrongdoing over claims they had made against British troops. The MoD said it was disappointed with the verdict which, if it had gone the other way, could have been fatal for the firm.

Now in an extraordinary intervention, Harman has written to the attorney general, Jeremy Wright, claiming that “the government’s pressure on the Solicitors Regulation Authority to take disciplinary action against Martyn Day and Sapna Malik of Leigh Day was an action which undermined the rule of law”.

The SRA’s case against Leigh Day was launched following the Al-Sweady inquiry into claims that British soldiers tortured and murdered Iraqi detainees following the battle of Danny Boy in 2004. It concluded that the allegations were “wholly without foundation” although it did find that nine Iraqi detainees had been mistreated.

Phil Shiner from Public Interest Lawyers, who represented a number of the detainees, was found guilty of 22 charges of misconduct and struck off.

The tribunal hearing the case against Leigh Day was told that 276 pieces of correspondence were exchanged between the MoD and the SRA. In several, defence ministers urged civil servants to contact the SRA to seek updates on the firms’ prosecutions.

Phil Shiner, solicitor for several Iraqi civilians, was found guilty of 22 charges of misconduct and was struck off.

Phil Shiner, solicitor for several Iraqi civilians, was found guilty of 22 charges of misconduct and was struck off. Photograph: Martin Argles for the Guardian

Senior officials at the authority replied, and its chief executive, Paul Philip, wrote directly to the defence secretary, Sir Michael Fallon, on at least one occasion. In several emails, SRA employees explained to MoD officials that they were unhappy with the way legal services were being regulated. Dr Ben Sanders, assistant head of responsibilities for public law and historic investigations at the MoD, responded to one: “I am sure ministers here will wish to be supportive.”

The counsel for Leigh Day, Patricia Robertson, suggested to Sanders that the correspondence showed a clear relationship between the SRA and the MoD. Robertson said: “Taking all of that material as a whole what we find here is the SRA using these disciplinary proceedings as a platform for lobbying the government for regulatory reform and also enlisting support from the MoD in that objective. That’s what we see in those exchanges isn’t it?”

Sanders replied: “Yes, I would say that seems a fair characterisation.”

The tribunal ruled that the authority must disclose all its correspondence with the MoD, MoJ, IHAT and the House of Commons defence sub-committee to the relevant parties. But it has not been made public.

Harman has asked the attorney general to publish all the correspondence including any alleged MoJ/SRA emails, which she claims “were wholly inappropriate and designed and perceived to subject the SRA to pressure”.

Before the tribunal, Leigh Day was subjected to fierce criticism in parliament. Fallon said that “the Al-Sweady inquiry was a completely unacceptable attempt to abuse our legal system to falsely impugn our armed forces”.

And David Cameron, then prime minister, declared that “Leigh Day has questions to answer, not least because it was deeply involved in the Al-Sweady inquiry”.

“Having your own government attacking you for doing your job as a lawyer crosses an important line and is something which has the potential for severe consequences for society,” Martyn Day told the Observer this weekend.

“We fully expect the Ministry of Defence to defend claims against it robustly, but there is a line to be drawn when it moves away from the claims and denigrates, in parliament, the lawyers who have been instructed to bring those claims. It would be a very sad day if British lawyers became too scared to take on the UK government, on behalf of individuals in this country and overseas, over issues which are essential to basic human rights.”

In her letter to Wright, Harman said: “It is quite wrong for the government to seek to dictate to the SRA who they should be taking action against. It is invidious for the government to denounce solicitors who are representing claimants who believe that their rights have been violated by the government.”

A MoJ spokesman said: “We fully respect the important and independent role the SRA plays in upholding standards in the legal profession. We are aware of the letter and are investigating further.

“However, early investigations have uncovered no evidence to support these claims.”

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Ministers ‘undermined law’ over Iraq war crimes allegations

Harriet Harman demands Ministry of Justice publish emails that may reveal it pressured law watchdog to act against Iraqi abuse lawyers

Harriet Harman says the government exchanged ‘wholly inappropriate’ emails with the Solicitors Regulation Authority.



Harriet Harman says the government exchanged ‘wholly inappropriate’ emails with the Solicitors Regulation Authority.
Photograph: Natasha Quarmby/REX/Shutterstock

Ministers ‘undermined law’ over Iraq war crimes allegations

Harriet Harman demands Ministry of Justice publish emails that may reveal it pressured law watchdog to act against Iraqi abuse lawyers

The government has been accused of undermining the rule of law by putting pressure on an independent regulator in its action against a legal firm pursuing claims of human rights abuses involving British troops in Iraq.

The former deputy leader of the Labour party, Harriet Harman, has called for the release of any emails that would reveal whether the ministries of justice and defence attempted to influence the Solicitors Regulation Authority (SRA) to act against Leigh Day. The human rights firm has been involved in many high-profile cases against British soldiers and has referred a number of them to the controversial Iraq Historic Allegations Team (IHAT), now being wound up.

Earlier this year, the firm, two of its senior partners, Martyn Day and Sapna Malik, and a junior lawyer, were cleared by the Solicitors Disciplinary Tribunal of any wrongdoing over claims they had made against British troops. The MoD said it was disappointed with the verdict which, if it had gone the other way, could have been fatal for the firm.

Now in an extraordinary intervention, Harman has written to the attorney general, Jeremy Wright, claiming that “the government’s pressure on the Solicitors Regulation Authority to take disciplinary action against Martyn Day and Sapna Malik of Leigh Day was an action which undermined the rule of law”.

The SRA’s case against Leigh Day was launched following the Al-Sweady inquiry into claims that British soldiers tortured and murdered Iraqi detainees following the battle of Danny Boy in 2004. It concluded that the allegations were “wholly without foundation” although it did find that nine Iraqi detainees had been mistreated.

Phil Shiner from Public Interest Lawyers, who represented a number of the detainees, was found guilty of 22 charges of misconduct and struck off.

The tribunal hearing the case against Leigh Day was told that 276 pieces of correspondence were exchanged between the MoD and the SRA. In several, defence ministers urged civil servants to contact the SRA to seek updates on the firms’ prosecutions.

Phil Shiner, solicitor for several Iraqi civilians, was found guilty of 22 charges of misconduct and was struck off.

Phil Shiner, solicitor for several Iraqi civilians, was found guilty of 22 charges of misconduct and was struck off. Photograph: Martin Argles for the Guardian

Senior officials at the authority replied, and its chief executive, Paul Philip, wrote directly to the defence secretary, Sir Michael Fallon, on at least one occasion. In several emails, SRA employees explained to MoD officials that they were unhappy with the way legal services were being regulated. Dr Ben Sanders, assistant head of responsibilities for public law and historic investigations at the MoD, responded to one: “I am sure ministers here will wish to be supportive.”

The counsel for Leigh Day, Patricia Robertson, suggested to Sanders that the correspondence showed a clear relationship between the SRA and the MoD. Robertson said: “Taking all of that material as a whole what we find here is the SRA using these disciplinary proceedings as a platform for lobbying the government for regulatory reform and also enlisting support from the MoD in that objective. That’s what we see in those exchanges isn’t it?”

Sanders replied: “Yes, I would say that seems a fair characterisation.”

The tribunal ruled that the authority must disclose all its correspondence with the MoD, MoJ, IHAT and the House of Commons defence sub-committee to the relevant parties. But it has not been made public.

Harman has asked the attorney general to publish all the correspondence including any alleged MoJ/SRA emails, which she claims “were wholly inappropriate and designed and perceived to subject the SRA to pressure”.

Before the tribunal, Leigh Day was subjected to fierce criticism in parliament. Fallon said that “the Al-Sweady inquiry was a completely unacceptable attempt to abuse our legal system to falsely impugn our armed forces”.

And David Cameron, then prime minister, declared that “Leigh Day has questions to answer, not least because it was deeply involved in the Al-Sweady inquiry”.

“Having your own government attacking you for doing your job as a lawyer crosses an important line and is something which has the potential for severe consequences for society,” Martyn Day told the Observer this weekend.

“We fully expect the Ministry of Defence to defend claims against it robustly, but there is a line to be drawn when it moves away from the claims and denigrates, in parliament, the lawyers who have been instructed to bring those claims. It would be a very sad day if British lawyers became too scared to take on the UK government, on behalf of individuals in this country and overseas, over issues which are essential to basic human rights.”

In her letter to Wright, Harman said: “It is quite wrong for the government to seek to dictate to the SRA who they should be taking action against. It is invidious for the government to denounce solicitors who are representing claimants who believe that their rights have been violated by the government.”

A MoJ spokesman said: “We fully respect the important and independent role the SRA plays in upholding standards in the legal profession. We are aware of the letter and are investigating further.

“However, early investigations have uncovered no evidence to support these claims.”

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