A solicitor accused of dishonestly funnelling nearly £20m of investors’ money from a legal financing fund into his own pocket told jurors this week the fund was set up to fill ‘the big black hole in the market’ after access to legal aid was reduced.
Timothy Schools, 61, is said to have received ‘just over £19.5m’ from the Cayman Islands-registered Axiom Legal Financing Fund before it collapsed in 2012. He allegedly used some of the money to pay for an estate in Cumbria, a personal trainer and football season tickets.
Prosecutors say the fund made loans only to Schools’ Preston-based ATM Solicitors in 2009, the year when it commenced trading, and that the firm was given its name because Schools used it as ‘his personal cash machine’.
However, Schools said the name was chosen in order to ‘attract clients, conduct their litigation and get them compensation so that we got money out of the other side.
‘My motivation was really generated through the withdrawal of legal aid funding in the first instance,’ he added.
Schools, of Penrith, Cumbria, denies three counts of fraudulent trading, one count of fraud and one count of transferring criminal property.
Co-defendant Richard Emmett, 47, of Grimsargh, Lancashire, denies one count of fraudulent trading and one count of facilitating the acquisition, retention, use or control of criminal property by another. Former financial adviser David Kennedy, 69, of Hetton-le-Hole, Tyne and Wear, denies one count of fraudulent trading.
The trial continues.