5. • How many warnings have the SRA issued in 2012
about criminals faking, cloning or just making up
firms?
6. • How many warnings have the SRA issued in 2012
about criminals faking, cloning or just making up
firms?
•17
• Are you a little concerned?
7. Case Studies
Acorn Solicitors – bogus firm in Rotherham
Nick Christofi and Sharon Griffin lost £735,000 when the vendor used
a cloned firm (May 2010)
Their solicitor was duped.
Acorn are a real firm in Taunton that never had a Rotherham office.
Made the Daily Mail on the 23rd August 2010.
Purchase conveyancing solicitors now closed.
8. Case Studies
Orient Solicitors
Totally fake firm in Leicester 2010
“Yet the website for Orient Solicitors is all too plausible, with an attractive
blonde solicitor in sharp relief, surrounded by eager, but slightly out-of-focus
male colleagues.
The words were the reassuring cliches of efficiency and probity you might
find on any corporate website - unsurprisingly, as much of it has been lifted
word for word from other solicitors' websites.”
Daily Mail, Sebastian O’Kelly 11th Oct 2010
9. Case Study
Lloyds Bank v Markandan and Uddin
• Solicitors for purchase sent £702,000 to a bogus firm.
• "The careful, conscientious and thorough solicitor, who
conducts the transaction by the book and acts honestly and
reasonably in relation to it in all respects but still does not
discover the fraud, may still be held to have been in breach of
trust for innocently parting with the loan money to a
fraudster. He is, however, likely to be treated mercifully by
the court on his section 61 application“ Lord Justice Rimmer
10. Case Study
Nationwide Building Society v Davisons
• Conveyancer for the purchaser sent money to a bogus
firm
• Find a Solicitor wrong
• Impact
• Panel status
• Ability to conduct conveyancing
• Distraction of professional indemnity claim
• Appeal 20th/21st Nov
11. s.61 Trustee Act 1925
Breach of Trust
s.61 relief
• Honestly
• Reasonably – as you would with your own money
….having regard to all the circumstances of the case.
• Burden of proof is on you
How do you prove you acted honestly and reasonably?
12. What does the CML Handbook say?
3.1.4
If you are not familiar with the seller's solicitors or
licensed conveyancers, you must verify that they appear
in a legal directory or they are currently on record with
the Solicitors Regulation Authority or Council for
Licensed Conveyancers as practising at the address
shown on their note paper. Check part 2 to see whether
we require you to notify us of the name and address of the
solicitors firm or licensed conveyancers firm acting for the
seller.
13. But the SRA says ……
SRA Warning Notice on Bogus Law Firms and Identity
Theft (26th March 2012)
12. ….. and therefore an entry on Find a
solicitor should not be taken as verification
that the firm is genuine.
14. But the SRA says ……
SRA Warning Notice on Bogus Law Firms and Identity
Theft (26th March 2012)
12. ….. and therefore an entry on Find a
solicitor should not be taken as verification
that the firm is genuine.
How does that help with proving you acted
reasonably?
16. So what do you face?
Make an innocent mistake and you could……
• Lose your panel status
• Face a professional indemnity insurance claim
• Have the Daily Mail potentially reporting all about it
• Brand damage
• Stress
• Distraction
• Staff morale
Are you the COLP or COFA by the way?
18. Solution?
• Sort code and account number
• Has it got a track record of successful use in
conveyancing?
• Immediate response.
• Email search report for your file
• £5 plus VAT (disbursement)
19. Solution?
• Sort code and account number
• Plus where there is a risk checks against over ten
other data bases? Including restrictions
• Where there is a risk identified 4 working hours
• Email search report for your file
• £10 plus VAT (disbursement)
20. Questions?
How good is it?
• Over 5750 live searches since July
• Have prevented frauds
• Have prevented many mistakes
• Have raised many questions about real firms
Demonstrates outcome focused approach to
clients
21. "We use Lawyer Protect on our cases because of the
real threat of fraud to all conveyancers associated with
sending client money to the vendor's
conveyancer. Criminals are out there trying to
defraud law firms clients accounts and we treat this
risk seriously for our clients.”
Daren Churchill,
COFA, Grindeys LLP
