Solicitor kept £60,000 of client funds as cash in firm’s safe

SDT: Solicitor posed continuing risk to the public

A solicitor who kept £60,000 of client funds in cash in the firm’s safe has been banned indefinitely from managing law firms.

The Solicitors Disciplinary Tribunal (SDT) described as “inept and ill-advised” the approach of Iftikhar Aziz to handling client money.

The tribunal heard that Mr Aziz was a registered foreign lawyer before being admitted in 2008 after completing the Qualified Lawyers Transfer Test.

He set up UK & Co Solicitors, based in Birmingham, as a sole practice in 2014, taking on Rahand Raza as a fee-earner in 2017. Mr Aziz was COLP and COFA. Mr Raza was struck off in early 2020, having been convicted for unlawfully sub-letting his council flat.

His brother, Faraidon Raza, was a non-lawyer partner at the firm and Mr Aziz’s brother-in-law.

The firm told the Solicitors Regulation Authority (SRA) it was closing in August 2020, having failed to secure professional indemnity insurance. The SRA, which had been investigating the firm since December 2019, shut it down the following month.

Most of the firm’s work was immigration, for which clients “ordinarily settled their fees by way of cash payments”, the SDT heard. It also received cash deposits for conveyancing transactions.

This was stored in a safe – as at January 2020, UK & Co Solicitors held around £60,000 in cash.

Barclays had raised a series of questions concerning the large number of cash payments and gave the firm two months’ notice that it would close its client and office bank accounts on 3 February 2020.

New accounts were not opened in time and the £17,900 in client account was transferred to Mr Raza’s personal account. The money was then returned to clients in cash from the safe. An office account was reopened at Metro Bank on 28 February.

The SDT said the “swapping” of monies from the client account into cash amounted to a withdrawal of client monies.

Mr Aziz was found to have breached the accounts rule by withdrawing money from client account in circumstances where it was not permitted to be withdrawn – it rejected Mr Aziz’s evidence that clients provided informed consent – and holding it as cash.

“It was plain to the tribunal that the client monies kept in the firm’s safe would have invariably been mixed with other types of funds.

“It was not readily discernible to the tribunal how, if at all, any delineation between client money, office money and/or other types of funds was made in circumstances where the firm held no bank accounts whatsoever.

He also failed to maintain books of account or carry out client account reconciliations.

The tribunal said it was satisfied that clients “did not appear to have been affected beyond any inconvenience caused by collecting their monies in cash from the firm”, but the harm to the profession’s reputation was “profound, given the cavalier approach” taken by Mr Aziz to handling client money.

The solicitor had shown “no insight” and “continued to pose a risk to the public”. The tribunal decided that a fine would not be in the public interest, given his limited means.

Instead he was made subject to a restriction order of indefinite duration, preventing him from being a law firm manager, COLP or COFA, from holding client money or being a signatory on any client account.

The SRA claimed over £73,000 in costs, which the tribunal reduced to £25,000 on the grounds of the solicitor’s limited means.

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