Scots lawyer who acted in mortgage fraud case struck off over failure to act in client’s best interests
A Scots lawyer who represented an elderly victim of a mortgage fraudster has been struck off the solicitors’ roll after being found guilty of “professional misconduct” over his failure to act his client’s best interests.
Solicitor Alistair Bowie, 69, concluded missives which resulted in title to the 70-year-old client’s home being transferred to Edwin McLaren, who was later found guilty of fraud and sentenced to 11 years’ imprisonment following a 20-month trial at the High Court in Glasgow – the longest in UK legal history.
The Scottish Solicitors’ Discipline Tribunal (SSDT) found that Mr Bowie had demonstrated a “serious and reprehensible departure from the standards of competent and reputable solicitors” in failing to take steps to avoid the fraud which was being perpetrated, after McLaren “duped” the homeowner into transferring ownership of her home.
‘No authority to act’
The tribunal heard that in November 2013 McLaren, using the alias David Johnston, had instructed Mr Bowie to open the client’s file after falsely claiming to her that he was willing to purchase her property in Dundee for £5,000, settle her outstanding mortgage, other debts and conveyancing fees, while allowing her to remain in the property as a tenant rent-free.
He induced her to sign an agreement to that effect, but in fact what she had done was sign a disposition transferring title of her property for £20,000.
But Mr Bowie, a partner with Hennessy Bowie & Co, did not make enquiries regarding why he was being instructed to act when the client lived in Dundee and he was based in Bishopbriggs and did not ask why at 70 she had decided to sell the property at below its market value or check whether she required a tenancy agreement.
Having accepted instructions from an intermediary, he failed to properly consult the client and had “no authority” to act on the client’s behalf when he requested the title deeds to her property and redemption figures for her mortgage.
Mr Bowie then failed to advise the client of the effect of the terms and conditions of the missives – “warnings which should have been at the forefront of his mind” – and failed to discuss the consequences of his actions, in particular the fact that she had no right to remain in the property.
He also made a “false declaration” as a notary public when he completed the client’s declaration of insolvency.
Mortgage fraudster McLaren targeted vulnerable homeowners in financial difficulty through newspaper ads.
He persuaded them to sell their homes with the promise he would clear their debts and allow them to remain in the property.
The conman then arranged for the homes to be bought at discount prices after making fraudulent mortgage applications, leaving his victims homeless and out of pocket.
Mr Bowie was said to be “entirely unaware” of Edwin McLaren’s fraudulent enterprise and “deeply regretful” of the distress caused.
He considered the case to be a “standard conveyancing transaction” albeit the client had been introduced by a third party, but he accepted that the things were not done as they ought to have been and wished he had been “more proactive” in enquiring about the circumstances with the client.
Mr Bowie retired in 2017 after an “unblemished record” of 42 years in practice and did not intend to reapply for a practising certificate.
However, the tribunal concluded that the “only suitable sanction” was to strike his name from the roll of solicitors.
In a written decision, SSDT chair Nicholas Whyte said: “Solicitors must always be trustworthy and act honestly. They must act in the best interests of their clients. They must have the authority of their clients for their actions. They must communicate effectively with their clients. They must advise clients of any significant developments in their case.
“Without instruction, the respondent requested title deeds and retained these. He requested redemption figures from the secondary complainer’s (the client) lender. He sent her land and charge certificates to another solicitor and drafted a discharge and draft letter of obligation. He failed to discuss and advise the secondary complainer at every stage of the process of the consequences of his actions.
“It was of great concern that the respondent concluded missives without the secondary complainer’s instructions. It is not possible to accept the clauses in a standard offer without detailed discussion with the client. If the respondent had believed the that the client was to remain in the house, he should have discussed with her the deletion of the clause regarding vacant possession. He ought to have identified that she had no right to remain in the property and discussed her plans.
“There were various warning signs throughout this transaction which should have caused the respondent to pause. If he had considered these as he ought, he could have taken steps to avoid the fraud which was being perpetrated against the secondary complainer.
“The respondent’s misconduct grew more serious as the course of conduct progressed. The tribunal therefore found the respondent guilty of professional misconduct in cumulo in relation to the earlier misconduct but individually with regard to his later behaviour.”
The tribunal balanced the finding of dishonesty with Mr Bowie’s unblemished record of a lengthy period in practice and considered whether a period of suspension would suffice.
It accepted that he had been “duped” by Edward McLaren, but said he “ought to have known better”.
Mr Whyte added: “On balance, the tribunal considered that the professional misconduct was so serious that the only suitable sanction was strike off. In coming to that decision, it took into account the effect on the respondent and the message to the public and the profession.
“While solicitors will sometimes become victims of fraud through no fault of their own, the respondent failed to engage with the secondary complainer about many of the warning signs that had been apparent in this case and then had gone to act dishonestly with regard to the affidavit. His behaviour went to the root of the trust placed in solicitors. Therefore, the tribunal ordered that the respondent’s name be struck off the roll of solicitors in Scotland.”
The tribunal also gave the client 28 days from the date of intimation of its findings to lodge a written claim for compensation.
© Scottish Legal News Ltd 2020