TRUST FUNDS

Hokitika Guardian, 26 November 1932, Page 2

TRUST FUNDS

DISHONEST SOLICITORS.

A REMARKABLE RECORD

iSYDNEf, November 17

It is little wonder that in Sydney the agitation for the institution of definite Government control of trust , funds held by solicitors should take more definite form. The New Zealand law in this regard lias been freely quoted during the last week or so, and the State Government has been urged to provide for the regular auditing of ail trust accounts. It- is also suggested that before a solicitor is permitted to handle trust money he should lodge with the Government, a substantial amount, sufficient to show that he is at least financial, and unlikely to be tempted to rob his clients. Hardly, a week passes in , Sydney without a dishonest solicitor being struck off the roll, and it is estimated that defalcations by solicitors revealed so far this year run to at least. £300,000. The latest revelations concern the bankrupt estate of Arthur Bernard Davies, who practised as a solicitor in Sydney for more than twenty years. He. was held in the highest esteem by a very wide circle of influential friends, yet shortly after he had committed suicide in his palatial ifome at Hunters Hill it was discovered that his trust funds were short to the tune of at least £26,000. In sub* sequent proceedings in bankruptcy last week his private secretary stated that Davies kept no books whatever. The only record of transactions concerning trust funds was that given on the butts of old cheque books. The total defalcations probably exceeded £30,000. . An examination of the list of defaulting solicitors reveals some astonishing examples of fraud. William Edward Hawkins, aged 69, who was sent to gaol for a year and nine months a few days ago for misappropriating trust funds, had been practising in Sydney for 46 years. He was a prominent church man and a leading Shakespearean scholar. Spread over a number of" years Hawkins misused £IO,OOO. in trust funds. During his examination in bankruptcy the Court wag crowded with his unfortunate clients. Many of them old women who could ill afford to lose their money. In the witness box Hawkins adopted the attitude of failing to remember what he had done with the trust money. Another glaring case was revealed in connexion with a bankrupt estate of the late Eric Kendall 1 Bowden, a former Minister for Defence in the Bruce-Page Government. He had practised as a solicitor for 38 years, and 1 many of those who reposed trust in him. are now ruined, for £IB,OOO could not be found. The biggest fraud of all was that committed by William Carnegie Clegg, another Sydney solictor, who for years was closely associated with the CJhurcli and charitable undertakings. His affairs are in hopeless confusion and! he js already serving a substantial terms of imprisonment. He is brought to the city every day in order to assist the officers of the Court in disentanglng his affairs. He probably, robbed hi* clients of not less than £200,000. , :