Bar candidate pledges 'anti-competitive' fight

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A Bar Association presidential candidate yesterday unveiled plans to uphold legal professional privilege and end "anti-competitive measures" impacting mortgage-related work.

Dr Peter Maynard told Tribune Business that he would ensure commercial banks and other lenders made mortgage and conveyancing work "more widely accessible", rather than sending it to just a select few law firms.

He accused lenders of demanding that attorneys purchase cost-prohibitive indemnity insurance as a means to 'price out' many from such work, describing this as an anti-competitive barrier.

Dr Maynard, in a letter to Bar members, said: "Mortgage institutions have imposed the arbitrary requirement of an inordinately huge amount of professional indemnity insurance for no apparent reason but to eliminate a wide swathe of lawyers from their lists of persons to do mortgage work.

"A reasonable amount of indemnity insurance is, of course, justified. But the required insurance policy is so large, and its cost so high, that it bears no resemblance to the work they might send you.

"The requirement is patently a discriminatory, exclusionary, anti competition measure based not in the slightest extent on the lawyer's competence, skill or acumen in doing mortgages."

Dr Maynard pledged to make mortgages/conveyancing work, and other commercial work, more accessible to all Bar members if elected as president - an office he has held before.

He promised to "reduce and rationalise professional indemnity restrictions" through discussions with the mortgage-lending institutions, and to use the Bar's "strength in numbers" to get insurance companies to offer a group policy that makes costs more affordable.

Dr Maynard told Tribune Business of the current situation: "It impacts upon firms who want to do more commercial work. We need to make it more widely accessible.

"We have 1,300 lawyers or thereabouts at the Bar. Many have ample financial and banking experience, but may well see very little work because it will go to a few firms.

"There are some skilled lawyers in boutique and medium-sized firms that would like to get commercial work. One of my charges is to make sure its fairly accessible, and they get compensated for the work."

As for the cost-prohibitive demands of lending institutions, Dr Maynard added: "They ask for huge amounts of indemnity insurance, and you never recover the cost of the premium in any work that they give you.

"That appears to be unfair competition. You pay a huge premium and never recover that premium for the work they give you."

Dr Maynard also disclosed a plan to strengthen the Bahamian legal profession's self-regulation, and address the long-running 'client/attorney privilege' dilemma created by the 2000 financial services laws.

The Bahamas, following the 2000 'blacklisting' by the Financial Task Force (FATF), effectively made attorneys 'policemen' in cases where they hold monies in trust on behalf of a client. They were required to submit to Compliance Commission oversight and inspections of their client 'Know Your Customer' processes.

This sparked legal action to defend attorney/client privilege on constitutional grounds, but Dr Maynard yesterday said the case brought by attorneys Maurice Glinton QC and Leandra Esfakis had been "stalled for a long time" in the Bahamian court system.

He suggested that the Bahamas should follow the Canadian example, where the Federation of Law Societies - not a government-created regulator - monitors attorneys for compliance with anti-money laundering and counter terrorism financing regulations.

Promising that he would push for such a model if elected president, Dr Maynard told Bar members: "Lawyers are not to be treated as accountants, bankers and insurance agents. The difference is that lawyers are critical to the existence of the rule of law.

"For example, in Canada, the Federation of Law Societies has already implemented what I have long advocated for in the Bahamas. As regulator, it is the Federation which monitors law firms there, and not a governmental Compliance Commission. Legal professional privilege is preserved, as the Federation monitors firms under the cloak of legal professional privilege...

"If given the opportunity, I would implement a solution to our long outstanding litigation in the Glinton, Esfakis case, and would propose legislation containing a new regime for the Bahamas."

Dr Maynard also suggested he would implement a 'no cash' rule for attorneys, arguing that they were "not bankers" and should thus reject any sum greater than $5,000 that was offered by clients.

"The proposal I suggest is the route they have taken in Canada," he told Tribune Business. "They have an excellent example in Canada. It also means taking our ethics seriously, putting our money where our mouth is, and putting out effective ethics standards.

"It should be an offense for rogue lawyers to be practising. I'd like to reform the Legal Profession Act to take that into account and put in a very strong ethics standard. The Bar needs creativity, fresh ideas and experience, and also vision."