Lawyer "Trust Funds"

How clients lose their interest

If you allow a solicitor to handle your inheritance they are compelled to put it in their "trust" account. In probate matters, solicitors often hold their clients' inheritance for at least 6 months, and this can cost beneficiaries a fortune in lost interest.

Once your inheritance gets into these "trust" accounts, the "system" invests it and keeps the interest. In 2000 the lawyer industry got about $30 million of interest on money belonging to its clients.

This method of "funding" was supposed to be for a "guarantee fund" to compensate clients whose money is stolen by their own lawyers, but very little of it is used for that purpose. Instead, the fund has become a slush fund for the lawyer industry - they have even stopped calling it a "guarantee fund" - they now call it a "public purpose fund" (from which the "public" is locked out).

The lawyers even fund their own trade association from the interest on clients' money - over $3 million in year 2000. And they can even use that funding to fight off claims from clients.

The "guarantee fund" cure has thus turned out to be worse than the disease.

The Estate Agents Guarantee Fund has also lost its way, and in much the same way. In 2003 it was renamed the "Property Fund" and instead of funding real estate consumers who get done by estate agents it funds the real estate industry itself - that is, the most overpaid group in the State is getting slush funded from a fund that was set up for the benefit of its clients.

Our vehicle registration plates proclaim:
"Victoria - the place to be".
It does seem to be the place to be if you want to witness the corruption of the purpose of guarantee funds.

Return to the Probate Kit page.

17 November 2006


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Lawyer "Trust Funds"

How clients lose their interest

LEGAL KITS OF VICTORIA