Solicitor who raided client’s estate to pay debts is struck off

Estate: Solicitor failed to pay over £200,000

A solicitor who used £100,000 from a client’s estate to pay debts to HM Revenue & Customs and an indemnity insurer before closing his firm has been struck off.

His misconduct led to the Solicitors Compensation Fund having to pay out double that amount.

Describing Cabeer Ahmed’s behaviour as an “abhorrent departure” from the standards expected of a solicitor, the Solicitors Disciplinary Tribunal (SDT) said he had shown a lack of insight by denying that he had breached the rules.

Mr Ahmed told the Solicitors Regulation Authority (SRA) that his firm, Hartley Bains in Stratford, East London, was closing at the end of September 2018.

However, an “orderly wind down of the firm” had not taken place.

Mr Ahmed, admitted as a solicitor in 2008, had received £440,000 into client account, proceeds from the estate of the late ‘GV’. He paid £240,000 to beneficiaries in early October.

GV’s nephew, SV, was told that no further payments would be made as the firm’s client account was “empty” and was instead sent details of its indemnity insurer.

SV complained to the SRA. Mr Ahmed was unable to explain to the regulator where the missing £200,000 had gone.

The firm’s insurer rejected the claim and, having determined that Mr Ahmed had acted dishonestly, the compensation fund paid out £200,000 plus interest to SV.

The SRA intervened in the remains of Hartley Bains in May last year.

Mr Ahmed admitted that he had failed to ensure that the £440,000 was properly transferred to SV before his firm closed but blamed his firm’s accountant, on whom he said he relied to advise on transfers from client to office account.

He admitted that he should have “checked better” than he did.

The tribunal found this was dishonest, lacked integrity, “severely and incalculably undermined public trust in him and in the profession”, and that the failure to preserve “the sacrosanct nature of the client account” was compounded by his attempts to absolve himself by blaming the accountant.

In the days before the firm closed, Mr Ahmed transferred £120,000 from client to office account, which he said he believed was money owed to him, although he again blamed the accountant for this.

Some £54,700 was paid to the firm’s indemnity insurer and £46,000 to HM Revenue & Customs.

The SDT said it was “abundantly clear” that this money came from GV’s estate and again this was dishonest and lacked integrity. The ruling did not state what happened to the rest of the money.

The sole practitioner failed to produce the firm’s books to the SRA, a breach of the accounts rules, claiming they were with the accountant in Ilford, Essex.

He had delegated responsibility for maintaining the firm’s books to the accountant “following a close family bereavement, familial ill health and domestic issues from late 2016”.

When asked to contact the accountant, Mr Ahmed said this was impossible because he was “constantly engaged”.

The SRA’s investigation officer checked the accountant’s name with Companies House and found that he had only traded for a year and was dissolved in December 2018.

Mr Ahmed “indicated his surprise” and said he was not aware that the accountant was no longer trading.

In additional mitigation to the events of 2016, he said he had “loved being a solicitor”, but he had not practised since 2018, was not working and was receiving Universal Credit. “He stated that he was ‘sofa surfing’ and had no savings.”

The tribunal said Mr Ahmed “took advantage of vulnerable individuals”. He was struck off and ordered to pay costs of just under £10,000.

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