A solicitor whose misconduct has led to the SRA Compensation Fund paying out nearly £600,000 to his former clients has been struck off.
Zahid Khan dishonestly used money taken in for conveyancing transactions to make payments related to other clients and also transferred it to his personal bank account.
Mr Khan, who qualified in 2006 and set up Janson Solicitors in Birmingham three years later, did not co-operate with the Solicitors Regulation Authority (SRA) or the Solicitors Disciplinary Tribunal (SDT), but his bank statements indicated that he used some of the money to trade on financial spread betting platform IG.com.
It appeared that between March and October 2017, the period for which the SRA had bank statements, he paid £380,000 to IG.com but only £350,000 was returned.
The SRA shut down the firm at the end of October 2019, shortly after an email from Mr Khan’s representative admitted to the regulator that there was a shortfall on the client account, that he had faced “extreme financial difficulties” and did not have the ability to replace the shortfall.
The email also said Mr Khan had borrowed £25,000 from a party in London in relation to which he had experienced “ongoing blackmail” and threats to his safety and that of his family.
The compensation fund has paid out £595,000 to his clients. “Despite the opportunity to do so, he had not provided any explanation to the [SRA] as to what has happened to the client money,” the tribunal recorded.
He also did not deliver on promises to provide bank statements and accounting records, even after he was served with a statutory production notice. By the end of 2019, his representative told the SRA that he understood Mr Khan was abroad but did not know for how long.
Such information as he did supply was “incomplete and misleading” – for example, he failed to disclose the existence of the personal bank account into which he transferred client money.
Striking him off, the SDT said Mr Kahn’s motivation was “a misguided attempt to deal with and respond to the financial difficulties faced by the firm”.
His misconduct had had a “devastating effect” on the reputation of the profession. He was also ordered to pay costs of £35,000.