HIGH Court judges have imposed greater suspension orders on two Stourbridge solicitors who acted for investors who lost millions when an overseas social housing scheme collapsed.

Michael Davies and Clare Taman were hit with 12-month suspensions and costs bills of thousands of pounds last autumn after being hauled before the Solicitors Disciplinary Tribunal in London - accused of breaching Solicitors Regulation Authority rules through their involvement with Ecohouse Developments which was behind a proposed Brazilian social housing scheme which crashed in 2015, owing £21million to investors.

But the suspension orders for both have now been tripled to three years each - after the Solicitors Regulation Authority appealed to the High Court, saying "the sanctions imposed were too lenient in a case where £20million was lost”.

At London’s High Court on June 21, Lord Justice Simon and Mrs Justice Nicola Davies quashed the original sanction of 12 months suspension and substituted an order of suspension for a period of three years.

The SRA was pleased with the result which follows calls by angry investors for greater punishments for the solicitors from long-running law firm Sanders & Co which had acted as escrow agent - a kind of contractual arrangement to accept investors' funds and pass them on as invoices are presented - for the Ecohouse scheme.

The respected firm in Hagley Road had been going strong for 41 years but no longer exists as Mr Davies and Ms Taman were forced to close the business in June 2016 after failing to secure professional indemnity insurance following the Ecohouse saga.

Stourbridge News: Sanders & Co

Paul Philip, SRA chief executive, said: "With Sanders & Co, we sought a higher sanction for the two solicitors involved because of the seriousness of the case.

"Investors lost a combined £21million in the Ecohouse scheme. This outcome should act as a clear deterrent to the rest of the profession.”

A spokesman for the Ecohouse Action Group, which was set up by the investors who lost cash, said: "The fact that the Solicitors Regulatory Authority felt the penalties initially imposed on the Sanders solicitors were inadequate, and that the High Court has now agreed with them, speaks for itself, and at least offers some further protection to the general public.

"However, this judgment has done nothing to help investors recover any of their funds. Despite Sanders & Co's inappropriate handling of over £20million of investors' money - even an apology has still not been forthcoming."

The SRA did not appeal sanctions imposed on Charles Fraser-Macnamara, a consultant for Sanders & Co for a time and a director of Ecohouse, who was also given a 12-month suspension last November and a costs bill of £10,000.

His daughter Katie, who also worked for Sanders & Co, also appeared before the tribunal last autumn but no order was made against her.

All four solicitors admitted breaching SRA principles by acting or permitting Sanders & Co to act for Ecohouse Developments Limited in relation to a complex overseas investment scheme and for 849 investors in a situation where there was a conflict, or risk of conflict, between the interests of Ecohouse, the interests of each individual investor and the interests of the firm or individual interests of Mr Fraser-Macnamara The tribunal determined all four failed to act in the best interests of each client and allowed their independence to be compromised.

Mr Davies, Ms Taman and Mr Fraser-Macnamara were found to have breached the principle which requires solicitors maintain public trust in the provision of legal services.

Allegations that Mr Davies and Ms Taman involved themselves in work that was outside their area of expertise - and where there was no legitimate need for the involvement of solicitors - were also proven.

Mr Davies, who was ordered to pay a costs bill of £35,000 at the tribunal, and Ms Taman, who was ordered to pay £17,500, were also found to have breached SRA rules by permitting payments into, and transfers or withdrawals from, the firm's client account which were not related to an underlying legal transaction or a service forming part of their usual regulated activities.

After the appeal hearing - Mr Davies, the borough’s former duty defence solicitor, told the News: “In my view the court should have struck out the whole of the appeal.”

And he accused the SRA of choosing its battles to focus on a small town firm - adding: “If the SRA really wanted to send a message to the profession - they’d pick on partners of a multi-national city firm rather than two partners of a small, provincial firm in Stourbridge. They don’t pick on the big boys. It’s the old adage - one rule for the wealthy and one for those who are not wealthy.”

He added that despite the suspension and the fact that Sanders & Co has gone into liquidation: “I still have to sort out things like people wanting files and any documents that we still have - which I’ve made provisions for the proper storage of. If we had been the sort of people who didn’t care about our professional obligations we wouldn’t have been still standing - but we’ve stuck it out.”

He said was disappointed with the three-year suspension as he had hoped to return to his roots representing defendants in the magistrates courts but he added: “I can’t do that. I’m going to have to find another job.”

Ms Taman, he said, has opted for a career change and Mr Charles Fraser-Macnamara no longer practises law.