Transactions suspicious, lawyer ordered suspended
VANCOUVER — The Law Society of British Columbia has ordered the suspension of West Vancouver lawyer Donald Gurney for six months for professional misconduct in letting $25 million of offshore cash flow into the country.
A two-person disciplinary committee found Gurney improperly used his trust account to receive and disburse $25,845,490 on behalf of a corporate client without making reasonable inquiries into the circumstances and without providing any substantial legal services.
“The fact that lawyers are constitutionally excluded from the Proceeds of Crime Regime means that the profession must ensure that all of its members comply with their duty to make reasonable inquiries in objectively suspicious circumstances,” the panel emphasized in its justreleased decision.
Phil Riddell, the panel chair from Port Coquitlam, and Gillian Dougans, a lawyer from Kelowna, criticized Gurney for being evasive and ignoring “a sea of red flags” in four questionable transactions between May and November 2013.
He breached his duty as “a gatekeeper” and his conduct posed a serious risk to the public, they maintained.
Gurney made no inquiries regarding who the lenders were, the source of the funds or the client’s use of the money, they said, concluding he had shown “a gross culpable neglect to his duties to make reasonable inquiries.”
Gurney, 74, countered that heightened public concern about opaque foreign investment and money laundering is a recent phenomenon, and that his age and practice led him to be less suspicious than he should have been. The panel rejected that reasoning. “The respondent’s experience at the bar, in particular the fact that he was an experienced solicitor, is an aggravating factor because those years of experience should have given him an appropriate appreciation of the importance of maintaining a trust account with integrity,” it said.
“To put it simply, with his experience at the bar, the respondent should have known better.”
The panel also gave short shrift to Gurney’s protestations he had done nothing wrong and that the disciplinary proceedings were unfair, abusive, a violation of the principles of natural justice as well as a vendetta and a “protracted effort to smear” one of the unidentified players connected to the transactions.
In a statement, Gurney said he is being persecuted.
“When this process began, we had expected the proceedings would be conducted in a fair, unbiased and civil manner,” he said in a brief statement issued by his lawyer Paul Jaffe.
“We have been disappointed on all counts. In fairness to members of the profession, and in the public interest, it is time that matters such as these be presented by trained and experienced prosecutors and be adjudicated upon by independent judges who understand their roles in the administration of justice. We are considering our appeal options.”
Called to the bar in 1969 with no prior misconduct on his record, Gurney was also ordered to relinquish the $25,845 he was paid — so he did not gain from his misconduct.
“The ‘fee’ received by the respondent was nothing more than a service charge to use his trust account,” the panel said.
“Counsel for the Law Society described this as the respondent renting his trust account, which is an apt description.”
If Gurney returns to practice after the suspension, the panel said he would be subject to conditions, including that he promptly report to the regulator any trust transaction involving a foreign remitter, beneficiary or receiving financial institution.
The suspension is to begin Nov. 1.