Unregulated Trust Companies Causing Headaches For Consumers

Using trusts as a means to protect assets for the next generation is a well-established practice in the legal community. However, it is essential that consumers choose a professionally regulated business with robust insurance to avoid any future problems.

Many unregulated businesses in the ‘planning for later life’ market are offering trust arrangements and targeting their services at the elderly, who are eager to ensure their hard-earned wealth is passed on to their children.

They often attract clients using professional-looking seminars, glossy flyers and brochures but the fees for setting up the trusts can run into thousands and the business owners often name themselves, or their business, as the trustees and thus legal owners of any properties transferred.

Sadly, it is only when such a business fails that clients and their families truly appreciate the consequences of these arrangements.

Earlier this year Universal Wealth Preservation (UWP) entered administration leaving many customers unable to contact them. As UWP have been named as trustees and executors on numerous legal documents some families have been unable to access assets or administer the estates of deceased relatives, adding to the stress of an already emotionally fraught situation.

Many concerned customers are now hastily instructing lawyers to try and find a way to unravel the trusts or remove UWP as trustees as well as other trust companies using similar methods.

Irwin Mitchell Private Wealth’s specialist Tax, Trust and Estates team has been instructed by several former customers of UWP, which is now also the subject of a police fraud investigation.

Solicitors have been told of problems including:

• Customers attempts to contact the company being ignored
• Concerns about management of  trusts and difficulties in locating assets and documentation
• UWP naming themselves on property title deeds and families now unable to sell properties to release funds
• Delays in estate administration whilst trying to resolve the issue of executorship
• Lasting Powers of Attorney (LPAs) not being registered with the Office of the Public Guardian and thus not able to be used at the time when the family needs them.

Expert Opinion

“Our advice is to seek help from a qualified and regulated lawyer as soon as possible. Sadly many companies have attempted to cash in on the market and have exploited unwitting consumers who were simply trying to provide for their families in future.

“Will writing and estate planning are generally unregulated services unless carried out by a solicitor who has to work under the remit of the Solicitors Regulation Authority and is accountable for any work carried out. Solicitors are also obliged to carry full professional indemnity insurance to cover all eventualities.

“Planning for later life and protecting your assets can be a tricky exercise that is fraught with emotion and potential legal pitfalls. Wills, trusts and powers of attorney are specialised pieces of work and should be carried out by legal professionals who are accountable and regulated for the work they do.” Kirstie Williamson - Tax Team Manager - Senior Associate

If you’re having difficulties with locating your assets then please contact us on our website or call us on 0370 1500 100.