UK

We advised members of an Isle of Man legal practice and an associated trust management company on an insurance coverage dispute arising from a GBP20m internal fraud that encompassed breaches of trust, an SRA investigation, the Third Parties (Rights Against Insurers) Acts of 1930 and 2010 and the differences between the laws of England and Wales as compared with those of the Isle of Man.

The fraud concerned an employee misappropriating GBP20m over a 15 year period through teeming and lading, which concealed the fraud for many years. The relationship between the law firm and the trust management company was an issue as the fraudulent employee of one entity was a director of the other entity. The insurance claim was declined at the outset. We successfully advised and negotiated a settlement whereby the professional indemnity insurers accepted liability and the claim was indemnified in full.