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Where there’s a will there’s a crook & a silent Law Society Complaints Chief : Jailed lawyer Michael Karus stole £400k from will, free after 12 months

21 Jan

Karus YellandLaw Society of Scotland’s regulation boss Philip Yelland & released ex-lawyer Michael Karus. THE LAW SOCIETY OF SCOTLAND’S Philip Yelland, the Society’s well known ‘Complaints Chief’ who, for the past twenty years has been in charge of the Society’s ‘Client Relations Department’, regulation and complaints against crooked lawyers, was, surprisingly nowhere to be seen in this week’s news of the early release from jail of crooked lawyer Michael Karus, who was sentenced in October 2009 for three-and-a-half years after he admitted embezzling nearly half a million pounds from a client’s will.

However during October 2009, Philip Yelland, a now well known figure to clients who have complained about their solicitors to the Law Society of Scotland, appeared on television & in newspapers, detailing & praising the way in which the complaints process had worked as Mr Karus was jailed for three & a half years at Edinburgh Sheriff Court.

Mr Yelland as the head of complaints against solicitors at the Law Society has been involved in hundreds, if perhaps thousands of complaints involving crooked lawyers, many of whom are still practising today, in spite of committing some of the most serious of financial frauds against their clients.

At the time of Karus being sentenced, Complaints Chief Mr Yelland, said on television and in a Law Society media release on the case : “… in previous cases where this type of situation has arisen, the tribunal have decided to formally strike a solicitor off the roll of solicitors, which means they can never practice as a solicitor again”.

Wrong. In reality, most solicitors who are the subject of complaints regarding their mishandling of wills continue to work as solicitors, while clients are not even aware of the fact their solicitor has probably committed a string of similar offences to those which Karus was found guilty of involving his deceased client.

Law Society of ScotlandPull the other one – Law Society’s Complaints Chief claimed solicitors are expected to maintain highest standards. Mr Yelland further commented : “Solicitors are expected to maintain the highest standards both in their professional and personal lives. Honesty is paramount in solicitors’ dealings with their clients. Mr Karus has clearly breached this fundamental principle of being a solicitor. Once the Society has official notice of his sentence from the courts, we will be able to raise a formal complaint against him to allow us to prosecute Mr Karus before the Scottish Solicitors Discipline Tribunal.” except of course Mr Karus is no longer a solicitor so the SSDT cant really prosecute him.

However, with news reports this week covering the release of Mr Karus some 12 months early, with even Police voicing surprise Karus was released so quickly, the Law Society of Scotland and Mr Yelland chose to make no comment at all, no media fanfare, nothing.

Look whose not talking now : The Law Society’s Philip Yelland made copious media appearances when Karus was jailed, however, no comment was forthcoming on his early release this week. (Click images below to watch video footage)

As the story goes, Michael Karus admitted embezzling over £413,052 while acting as executor of the estate of Edith Hampton, 89, formerly of the Victoria Manor Nursing Home in Albert Street who died in 2003. Ms Hampton, a former teacher who never married and had no children, hired the now free Karus in 1992 to draw up a will leaving her estate to the Cancer Research UK charity.

However, Ms Hampton changed her will seven years later to leave the money to June Pirie, her cousin’s daughter and Karus used one of the well used tricks in a lawyer’s book, informing the beneficiaries it had all gone to a charity – in this case, Cancer Research., while in reality Karus had pocketed the money himself.

It is reported that Karus, in keeping with the best traditions of the Scottish legal profession when dealing with wills & deceased clients, boasted of being a “shark” who preyed on vulnerable victims and even named two of his firms GWS which stood for Great White Shark and Mako, after the shark, in celebration of his predatory style.

Following Ms Hampton’s death, Karus, acting has his deceased’s client’s legal agent, and by the sounds of it, Executor, transferred the money into his personal account, where an audit revealed he had paid £115,000 to Edinburgh Metropolitan Properties, of which Karus was a director, some £82,000 to the Karus & Co pension fund and a further £60,000 to a judicial factor, clearing off his own law firm’s debt, and up to £5000 went to pay off debt on Karus’ credit cards.

Cancer Research UK, who were made aware of Ms Hampton’s wishes in her initial will, repeatedly contacted Mr Karus at his law firm to ask why the bequest had not been paid, however Karus told the charity a second will leaving the money to Mrs Pirie had emerged. Cancer Research then contacted the Police who began an investigation in 2007 after it was found Ms Hampton’s second will made out to her cousin’s daughter had not been registered.

In an attempt to cover his tracks, Karus then registered the second will in April 2008, although this came some three weeks after he had appeared at Edinburgh Sheriff Court on charges connected with the case. The contents & wishes of Ms Hampton’s second will, leaving her money to her cousin’s daughter were confirmed after Lothian & Borders Police obtained a copy of the will and handwriting confirmed its authenticity, confirming Mrs Pirie as the legitimate beneficiary. Michael Karus was subsequently found guilty at Edinburgh Sheriff Court in 2009 & jailed for three & a half years, now since released.

COPFSCrown Office claimed at the time of Karus’ sentence, those like him will be made to face justice, while little in the way of prosecutions against crooked lawyers have occurred since. Speaking at the time after Karus was sentenced, Scott Pattison, Crown Office Director of Operations, said: “Michael Karus abused his position as a lawyer and the trust placed in him by Edith Hampton in order to steal her life savings, which amounted to over £400,000. Ms Hampton entrusted him to ensure that her property was passed on according to her wishes; but he took advantage and took this money for himself.”

He added: “This case shows that those like Michael Karus who use their professional status to perpetrate crime will be made to face justice.”

Well, not really .. as most people who report crooked lawyers to the Crown Office or the Law Society of Scotland, find out in cases such as : Crown Office claims its too costly to keep details on legal profession’s crooks, or Law Society ‘routinely fails to report crime’ as Crown Office admits it never received report on Glasgow lawyer theft cover-up investigation or even more recently : Justice for all ? Scotland’s Crown Office refuse to prosecute ‘crooked lawyers’ who ‘wrongly’ claimed £221K in Legal Aid funds

Asked about any further investigations taking place against Michael Karus, a spokesperson for the Crown Office released a statement confirming there would be further proceedings. He said : “There is a live Proceeds of Crime action against Mr Karus. The case is next due to call for a confiscation hearing on 21 February 2011.”

A legal insider today advised people making a will to make sure they left some form of second copy with a trusted source other than their lawyer, as it is now becoming increasingly popular due to the recession and ever decreasing profits of law firms for Scottish solicitors to abuse the contents of a deceased client’s will and pocket the money themselves, with the tactics used by Karus, telling one beneficiary it had went to charity, and informing the charity a new will had been discovered, becoming commonplace.

He said : “The fact of the matter is there is very little the Law Society will do to most solicitors who are caught pocketing the contents of a dead client’s will for their own benefit. The situation is now so bad the Law Society are even refusing to accept complaints from beneficiaries who discover their loved one’s final wishes have been usurped by a crooked lawyer, with the proceeds of their residual estate ending up in the lawyers pocket rather than the intended beneficiaries.”

A solicitor speaking to Diary of Injustice this afternoon revealed he is dealing with case on behalf of a beneficiary to a will where a partner in a well known Edinburgh law firm, who is the subject of an ongoing complaint regarding the contents of a will, stands accused of much the same offences committed by Michael Karus, involving significant amounts of money from a deceased’s estate.

A complaint was made to the Law Society by a beneficiary who discovered a second copy of the will which named family members of the will, rather than a charity, which all investigations so far have shown, was not known to the deceased. However, the solicitor further revealed the Law Society of Scotland have consistently refused to accept the complaint regarding the handling of the will, claiming the beneficiary, who discovered the ongoing fraud regarding the handling of the will, did not have an interest in the case, and therefore could not make a complaint.

I would advise any beneficiaries who are attempting to make complaints to the Law Society of Scotland or the Scottish Legal Complaints Commission regarding the conduct of a solicitor involved in a will, to pursue their complaint with determination, no matter how many times the Law Society or SLCC refuse to deal with it. I would also advise those involved in such cases to publicise their complaint and details of what the solicitor did in the national press, or to contact Diary of Injustice at scottishlawreporters@gmail.com.

While I stress it is a very noble and welcome gesture of public spirited persons to leave amounts to charities, I would advise beneficiaries to check the contents of wills, especially when large amounts are left to institutions, to ensure the will and its terms are authentic and are being handled according to the final wishes of the deceased, rather than the final wishes of a crooked lawyer.

I have written more on the subject of wills, HERE, and particularly, here : Consumer warning on wills : Don’t make your lawyer your executor as soaring cases of ‘will fraud’ show Law Society closes ranks on complaints

Scotsman coverage of some of the stories relating to Andrew PenmanMany crooked lawyers & accountants who ruin wills for their own motives, still work today. Speaking from my own bitter experience of being ripped off by a crooked lawyer – Andrew Penman of Stormonth Darling Solicitors, Kelso, and an accountant – Norman Howitt of JRW Group, both based in the Scottish Borders, more of which you can read about HERE & HERE, I would stress anyone thinking of making a will, or those of you who have already made a will, if you have made your solicitor or accountant an executor, have it re-written now, otherwise your final wishes could well end up in the lawyers pocket just as it did with Mr Karus and his still working colleagues spread across Scotland, rather than your family or loved ones, or even the charity of your choice.

Background information on the Scottish Solicitors Discipline Tribunal (SSDT) prosecution of Michael Karus :

A 2005 decision from the Scottish Solicitors Discipline Tribunal, the well known puppet of the Law Society’s complaints process, supposedly suspended Karus from legal practice for 10 years : The Tribunal having considered the Complaint dated 4th August 2004 at the instance of the Council of the Law Society of Scotland against Michael Louis Karus, Solicitor, 72 St Stephen Street, Edinburgh; Find the Respondent guilty of professional misconduct in respect of his breach of Rules 4(1), 8, 9 and 10 of the Solicitors (Scotland) Accounts, Accounts Certificate, Professional Practice and Guarantee Fund Rules 2001, his continuing to act as a principal solicitor in private practice while his practising certificate was restricted during the period between 14th December 2001 and 28th February 2002 and his uttering a cheque in the sum of £70,000 payable on the Karus & Company client account and making the withdrawal without the authority of the principal and notwithstanding the suspension of his practising certificate; Suspend the Respondent from practice for a period of 10 years; Find the Respondent liable in the expenses of the Complainers and in the expenses of the Tribunal as the same may be taxed by the auditor of the Court of Session on a solicitor and client indemnity basis in terms of Chapter Three of the Law Society’s Table of Fees for general business and Direct that publicity will be given to this decision and this publicity will include the name of the Respondent but such publicity will be deferred until the conclusion of any criminal proceedings against the Respondent.

The full finding by the Scottish Solicitors Discipline Tribunal can be downloaded HERE (pdf) Earlier findings by the SSDT regarding Michael Karus, can be downloaded HERE & HERE

Where there's a will there's a crook - Sunday Mail November 28 2010Remember Remember – Where there’s a will there’s a crook. Suspension from legal practice is, however, no deterrence for crooks to come back and rip off people and their wills, as a recent Sunday Mail article exposed the case of the former jailed lawyer Valerie Macadam, now Valerie Penny returned from legal oblivion & started her own will writing business without telling her new clients she was jailed for embezzlement. One can only wonder what Mr Karus will come back as, however he may be forgiven for viewing himself as slightly unfortunate, as Andrew Penman & Norman Howitt got away with it quite nicely, courtesy of the self regulating Law Society of Scotland & Institute of Chartered Accountants of Scotland, neither of which I would ever advise anyone to trust.

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