Solicitor struck off after investing client money into scam scheme

A solicitor who made improper transfers of £230,000 from her firm’s client account into her personal account, then lost it when she invested it into a scam scheme, has been struck off.

Uyiosasere Ona Obaseki, admitted to the roll in June 2004, transferred £230,000 from the firm’s client account into her own personal account and then invested the money into a purported investment scheme with ISG Exchange. The money was lost as the scheme turned out to be fraudulent. Obaseki reported the scam to police.

The tribunal heard Obaseki had since made partial repayments to the client but he was still ‘owed a considerable amount’.

The Solicitors Regulation Authority only found out what had happened ‘indirectly’ when Obaseki’s client had made an application to the compensation fund.

Of the eight allegations against Obaseki, three were found not proved and five were found proved.

The tribunal also found dishonesty proved in respect of two of the proven allegations, that she provided 'misleading and/or inaccurate information to the firm’s professional indemnity insurers…in that she failed to disclose the circumstances of the loss of funds and [the client’s] demands for repayment' and she ‘failed to make an accurate and or timely report to her client of the loss of £230,000 of his funds’.

It was found that ‘any misconduct was not a single episode nor one of very brief duration in a previously unblemished career’.

The judgment said: ‘Ms Obaseki ought reasonably to have known that all her misconduct was in material breach of her obligations to protect the public and the reputation of the legal profession.’

It added: ‘She seemed to think that she was owed an interest free loan from the client until it was convenient for her to make repayment. Her approach in evidence to concealing from the client that the money had been lost indicated that she still felt that, as long as she could get the money back over a period of time before the client found out, that was acceptable conduct.’

Obaseki’s mitigation statements showed ‘clearly that she still thought that as her misconduct occurred outside her role as a solicitor, she had been quite right not to disclose it to the insurer’.

Costs of £68,082.85 were sought by the SRA - £45,000 related to the regulator’s investigation costs and £18,5000 for work by the SRA’s legal adviser Capsticks.

Striking off Obaseki, the SDT ordered that she must also pay £52,686 in costs.