Taken from: The Sunday Times 10 July 2005
Further reading: Probate Fraud
July 10, 2005
THOUSANDS of people are being swindled by dishonest solicitors, legal advisers and money-grabbing relatives, according to a report on probate fraud out on Wednesday, writes David Budworth.
The Society of Trust and Estate Practitioners (Step), the author of the report, will be pressing ministers at a meeting on Thursday to take action.
Lord Falconer, secretary of state for constitutional affairs, has declared that, if he can be persuaded that there is a serious problem, he might introduce regulation.
Probate fraud is usually committed by solicitors, legal advisers, carers or relatives appointed to wind up an estate. They are able to commit fraud because they have access to the deceased’s property and paperwork.
It is also easy for someone who has been granted enduring power of attorney (EPA) or receivership. Both give the holder complete control over a person’s financial affairs and property before death. Receivership is invoked when the person is incapable of granting power of attorney.
Step surveyed its members, who include lawyers, accountants and bankers. Its report shows the problem is widespread. Half those who responded said they had come across cases of suspected fraud or theft from an estate, mostly in the past 12 months. Probate fraud is estimated to cost £150m a year.
Geoffrey Shindler, vice- president of Step, said: “The present system is letting down too many people. We need government action to protect beneficiaries from financial loss and emotional distress.”
The means of deception are varied and frequently ingenious. They include bogus wills, false accounting and plundering of bank accounts.
Abrupt changes to the will or unexplained withdrawals from bank accounts made not long before death might be cause for alarm. So might the transfer of large sums of money or property, or the disappearance of valuable items.
Other warning signs are the inclusion of someone else’s name on a bank account, a relative who takes over the management of the person’s finances but leaves bills unpaid, or someone who is anxious and confused about his or her finances.
Under present rules, all beneficiaries are entitled to answers to any reasonable queries, but under the English system they are not legally entitled to see the estate’s accounts.
They have to rely on the executor of the will to provide them with information, even though he or she could be the one committing the fraud.
Step wants beneficiaries to be given automatic access to all key documents, including the will and details of an estate’s accounts. It is calling for a licensing scheme, so that those found guilty of misconduct can be barred from practice.
Frank Nesbitt, a detective in the economic crime squad of Northumbria police, said: “Probate fraud is a big problem. There is no control over solicitors when they are drawing up a will or administering an estate.”