The case of David Rasif absconding with his clients’ funds, and the controversy over interest on stakeholding money in en bloc sales raise questions as to how well lawyers here look after their clients’ money.
I was therefore surprised by the legally correct, but rather short-sighted, answer from the Law Society regarding the en bloc sale issue (’Who gets money a matter of contract’; ST, July 6).
Singapore is making a strong bid to become the offshore financial centre of the future. An essential part of this strategy should entail building the confidence of international investors that their money is safe in Singapore, and that Singapore will follow international norms on financial transactions.
I would expect the Law Society to take the lead on such issues. For example, it could introduce a compulsory insurance scheme for all its members, which would pay out in the event of a lawyer absconding. Although such a scheme may look expensive, especially for small practices wishing to undertake large transactions, the overall effect would be to significantly reduce risk and improve confidence.
Similarly, the Law Society should clarify once and for all the issue of interest on transactions. In my property transactions overseas, the lawyers had returned interest earned to me without question. Lawyers should be paid well for their professional services - they should not also be a party to the transaction.
By thinking long term and creating a legal framework that meets or exceeds the needs of international investors, Singapore lawyers stand to benefit, and Singaporeans can be confident their interests will be similarly protected.
Source: The Straits Times, 12 July 2007
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