Recent regulatory actions have seen solicitors being fined for failing to adequately warn clients of investment risks.
- Jonathan Sara, once a director at Private Office Legal Services, faced fines due to handling high-risk care home room investments as ordinary conveyances.
- The Solicitors Regulation Authority (SRA) highlighted repeated advisory failures, potentially harming over 100 clients.
- Despite substantial warning from the SRA, the risks inherent in fractional development investments were not adequately communicated.
- Anca-Florina Mitrana, a junior solicitor, was also reprimanded, reflecting on the challenges faced by inexperienced legal professionals.
The Solicitors Regulation Authority (SRA) has imposed fines on solicitors for failing to provide adequate advice regarding high-risk investments in care home rooms. This regulatory action underscores the necessity for legal professionals to thoroughly communicate the potential pitfalls to their clients.
Jonathan Sara, formerly a director at Private Office Legal Services, was fined after representing over 100 clients between February 2017 and March 2019 in investments involving various care home developments. The SRA noted that these transactions were treated as typical conveyances, despite their distinctive risks.
The SRA had previously issued warning notices in September 2016 and June 2017, emphasizing the importance of proper advisement on such investments. The failure to heed these warnings led to serious repercussions for the involved parties, with many investors suffering financial losses as the schemes often did not succeed.
Mr. Sara’s approach led to a £5,165 fine, calculated as 8% of his annual gross income, alongside additional costs of £1,350. The SRA acknowledged that Mr. Sara did not act dishonestly or with intentional misconduct, though his failure in judgment was significant across multiple cases.
Notably, Anca-Florina Mitrana, a junior solicitor at the same firm, received a reprimand for similar advisory inadequacies. Her actions were not deemed intentional, considering her newly qualified status and lack of supervisory guidance, which mitigated her culpability. She now practices at another firm, demonstrating career resilience despite early professional challenges.
This case highlights the imperative for legal practitioners to apply due diligence in high-risk financial advisories, ensuring informed client decision-making.
