You are here

Immigration Advisory Service collapses after financial management probe

11 July 2011

Immigration Advisory Service, the largest charity with Legal Service Commission funding for the provision of immigration advice, went into administration on Friday evening amid increasing financial difficulties, with 400 staff being made redundant overnight.

It is understood that staff were not told about the closure when they left the office last week. Today, they returned to find that locks had been changed over the weekend.

Solicitors Journal sources say that a recent audit by the LSC identified overclaiming in the millions of pounds and that in numerous cases the charity had been unable to provide evidence of claimants’ eligibility.

The charity, which earned about £15m a year from its legal aid contracts, held discussions with the LSC over a new business model earlier this year but the talks did not result in any change to its management structure.

The legal aid body was keen to distance itself from the news today, saying the decision to file for administration was IAS’s trustees’.

“The Immigration Advisory Service’s decision to go into administration is theirs alone,” a spokesperson said.

He continued: “During recent stewardship activities LSC raised concerns around financial management and claims irregularities which prompted IAS trustees to conclude that the organisation was no longer financially viable.”

He added that the LSC’s priority was to “work closely with IAS and the administrators to ensure clients of IAS continue to get the help they need, while safeguarding public money”.

By mid-afternoon, there were still no arrangements in place for the transfer of cases to alternative providers.

“We are now identifying alternative advice provision in the areas affected and arrangements for case transfer will follow as soon as possible,” the spokesperson said, before adding that IAS clients should check the charity’s website for updates (www.ias.org.uk) and that anyone who needed immigration advice should contact the Community Legal Advice helpline on 0845 345 4 345.

IAS is the second immigration charity to feel the consequences of the tightening of legal aid.

This time last year, Refugee and Migrant Justice went into administration blaming delays in payment.

Observers already fear a repeat of the events that followed, temporarily leaving about 13,000 clients without an adviser.

Replying to a question by Simon Hugues in the Commons a week later, Ken Clarke said RMJ had been paid when due but had not made the efficiency savings that other providers made.

Categorised in:

Legal Aid Local government