Judgment offers greater protection against estate fraud

Finders InternationalBy Legal Futures Associate Finders International

People who help themselves to money from a deceased person’s estate is an occurrence that is not ats rare as it could be, according to a recent article in Today’s Wills and Probate exploring estate fraud.

In the article on the website, the firm Wilson’s Solicitors said it had dealt with many cases involving theft from estates. It quoted a recent case, the Court of Appeal judgement in the ‘HDI Global Specialty SE v The Guide Dogs for the Blind Association & Ors  where an “extreme level” of theft was carried out by a probate practitioner, Linda Box of Dixon Coles & Gill in Wakefield (the firm has since been shut down by the Solicitors Regulation Authority) where she admitted misappropriating client funds of more than £4 million.

Box is thought to have stolen far more. She targeted the money belonging to deceased people’s estates, often pocketing what was due to go to charities. While her firm’s insurer (HDI Global Speciality SE) was not obliged to cover her actions directly, it was obliged to cover her two partners, who are vicariously liable for her actions. The insurer claimed it should only be liable for up to the insurance limit of one claim – £2 million – as the firm only had the minimum legally required insurance in place.

Theft one continuous act

The firm reasoned that Box’s thefts, even though they took place over a decade, should be considered as one continuous act (and thus once claim).

In his estate, Mr Scholefield left donations to various charities. Those beneficiaries, along with the Bishop of Leeds (Box also stole from the Bishop of Wakefield) defended this line of argument all the way to the Court of Appeal. They have achieved a legal precedent (if it is not successfully appealed at the Supreme Court level) that should help all beneficiaries (charities and inviduals) who lose out on an inheritance because of probate practitioners that steal from estates on a large scale, where those practitioners are either employees or who operate in a partnership that insurance companies would otherwise have been able to avoid covering.

Wilson’s Solicitors pointed out this would come as a great relief to those partners of criminal probate practitioners, who might have found themselves having to deal with the aftermath out of their own pockets.

Second pair of eyes on estate administration ‘critical’

The firm added that a second par of eyes on probate administration was a critical component in preventing such things from happening in the first place. One of Box’s partners needed to deal with a task on one of her files when she was on holiday over Christmas 2015/2016, and noticed the fraud where payments had been made from the estate’s funds to a creditor who should not have received money from the estate.

Box immediately admitted misappropriating the estate assets to pay for her credit card bills, among other things, when confronted, having taken more than £500,000 from that estate alone. Further investigations revealed that payments to the same creditors had been made from many other estate administration client accounts.

Charities should be able to ask for the supporting estate accounts and to be able to check these. Box’s estate accounts provided to Scholefield’s beneficiaries did not reflect the reality of his assets and those beneficiaries have yet to receive the money he intended them to have. Following the Court of Appeal’s judgement, they will be able to continue to press for this to happen.

Wilson’s Solicitors points out that where estates are administered by sole practitioners, any insurance is unlikely to apply if those practitioners carry out criminal activity as Box did.

Finders International trace missing beneficiaries to estates, properties and assets.  To see a full list of our services, please visit our website.  Alternatively, you can contact us via telephone +44(0) 20 7490 4935 or email contact@findersinternational.co.uk


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