A licensed conveyancer who took a second job working for a client without telling her firm, and then failed to follow its procedures when dealing with him, has been sanctioned for her misconduct.
The Solicitors Regulation Authority (SRA) decided that Brenda Devereaux, who worked at Hertfordshire firm Gisby Harrison, should not work for SRA-regulated firms in future without its permission, as per section 43 of the Solicitors Act 1974.
She worked for the firm for approaching 14 years to July 2020, initially as a conveyancing secretary and then as a licensed conveyancer.
In February 2020, she took a second job as an executive assistant at Company A, which was owned by a long-standing client of the firm, Mr A. They had become close friends, the SRA recounted, but Ms Devereaux did not tell Gisby Harrison about the job, as her employment contract required.
She was also acting for Mr A on the purchase of a property and the SRA said she twice failed to follow firm procedure in her dealings with Mr A as a client.
Soon after starting the second job, Company B, a financing company, paid £150,000 into the firm’s client account for Mr A. He claimed the funds came from the sale of two paintings to Company B for £500,000, and he wanted to use them to buy the property.
“Ms Devereaux made no further enquiries following the receipt itemising the sale of the pictures together with copies of the pictures from the purchasing gallery,” the SRA said, including no source of funds checks.
“Following Ms Devereaux’s resignation, the firm asked Mr A to provide assurances as to the origin of the deposit but received no reply. Mr A then transferred his instruction to another firm.”
On the second occasion, Mr A was required to provide a personal guarantee and asked Ms Devereaux to provide a financial reference. She did this from the firm’s email address without its knowledge.
In drafting the reference, Ms Devereaux relied on a letter from an estate agent detailing the potential value of Mr A’s properties after renovation. “There was no evidence that Ms Devereaux had made any enquiry of Mr A’s assets and liabilities or had any knowledge of his total worth.”
In an unrelated matter, the firm received an offer of a loan on a property from a mortgage company for a Mr S. The offer confirmed that Ms Devereaux had previously acted for a Mr and Mrs P to transfer their property to Mr S, their son.
The firm had not been aware of this matter until it received the offer, by which time Ms Devereaux had left.
There was no file on the firm’s system. However, Ms Devereaux’s computer contained an email sent to Mr S’s girlfriend in June 2020 with a TR1 transfer form and a response with poor copies of identification documents for Mr and Mrs P. The TR1 was signed by Mr S and witnessed by his girlfriend.
But no client due diligence had been completed, nor were any online anti-money laundering identification checks made.
Ms Devereaux admitted the misconduct and cooperated with the SRA’s investigation.
In mitigation, she said she was not aware that she had to inform her firm before accepting secondary employment.
Further, as a close friend of Mr A, she said she did not need to check the source of payment further and had the confidence to provide the reference; in any event, she pointed out, the reference stated that neither she nor the firm could be held liable for any claims within it.
Ms Devereaux claimed to have taken instructions from Mr and Mrs P via a video call as both were self-isolating. She also claimed that all documents were left in the office to be opened by staff and she could be held responsible for their loss.
But she accepted that a section 43 order was appropriate as her personal and business relationship with Mr A caused her to act “recklessly”.
The SRA said: “She put herself at risk of a conflict of interest and acting when her independence was compromised. This exposed the firm to risk of breaches of SRA requirements and potentially unknowingly facilitating money laundering.”
She also misled the firm and a third party, and failed to protect clients by obtaining their proper identification and recording their instructions before acting.