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Anon @ 1:56pm
I can't agree with your reasoning. Every penny held in a client account should be held on trust for somebody. Buyer's solicitors will hold monies on trust for the purchaser pending completion, and for the vendor thereafter.

In this case, completion did not and could not take place because the person purporting to sell did not have any title to the property. The monies were therefore still held on trust for the purchaser, and released in breach of that trust. It is irrelevant as to whether a signed and dated TR1 was issued; actual completion did not take place.

Further, the breach of trust was not contested by A'Court. The main issue is whether they could obtain relief under s.61 TA on the basis that they acted honestly and reasonably - a very hard threshold to meet when you've failed to undertake proper AML checks on your own client.

There's no doubt that the fraud would have failed if AML checks had been properly undertaken. However, I'm not convinced that the buyer would have pulled out had the purchaser's solicitor acted differently and highlighted their concerns. For that reason, A'Court are surely the most responsible.

A solicitor should be able to rely on their counterpart undertaking proper due diligence on their own client, just as we should be able to assume that monies coming from another solicitor's client account are not proceeds of crime. The other solicitor should foot the bill for any failings here. It's bad enough that we have to check for rogue solicitor firms; we shouldn't also have to check whether their client is who they say they are.

I hope HOC appeal successfully.

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