We have again warned the public to be wary of the increasing problem of questionable investment schemes that use the involvement of solicitors or to encourage them to pay over money.
The vast majority of solicitors would never engage with dubious investment schemes, but a tiny minority have become involved. In the last nine months, we have taken action against eight law firms, in cases where people have lost around £50m.
As interest rates stay low, more and more people are looking at different ways of securing a high return on their savings. There are many legitimate ways of investing money, but some schemes offering high returns can be very high risk or questionable.
In particular, we are seeing cases that are promoted as investments in property or land when the reality is very different and the investment depends on the success of a business, such as a hotel or storage company.
We have provided a range of advice for people who are considering investing. This includes always using their own trusted law firm or adviser.
Paul Philip, SRA Chief Executive, said: “The vast majority of solicitors act with honesty and integrity. Only a tiny number of solicitors are involved in these schemes, but the damage can be huge, with people losing their life savings.
“We will continue to protect the public by taking action against solicitors who fall short of the high standards we all expect. Yet the best way for people to stay safe is to make sure they are aware of the risks. If something looks ‘too good to be true’, it probably is.”
The warning has been repeated because of increased reports and continued large losses.
We are currently looking into cases involving the loss of tens-of-millions of pounds. As well as examples of the schemes involving property, our warning includes information on general warning signs investors should look out for, and ways they can protect themselves.
The new warning can be found here:
The original warning, published in November, can be found here: