When dealing with clients in financial matters, it is crucial to conduct thorough due diligence by asking relevant questions, performing necessary searches, and ensuring accurate client disclosure. This process allows a solicitor to gain a comprehensive understanding of the client’s financial situation, even when the client isn’t fully aware of their own financial details.
From the onset, it is essential to inquire about the client’s various assets, such as real property, shares, and business entities. Solicitors must perform searches to verify the client’s instructions, even if they seem confident about their financial matters. This is especially important when representing a client who wasn’t the primary financial decision-maker in the relationship. Searches can include title searches for properties (to confirm the registered owner and any mortgages) and ASIC searches (to verify interests in corporate entities).
In cases where a solicitor suspects the client or the other party isn’t completely forthcoming, they should take proactive steps to obtain the necessary information. This can involve sending further requests for documents and reminding the other party of their obligation to provide full and frank disclosure of their financial circumstances. Additionally, the solicitor should emphasize the potential consequences of failing to meet these obligations.
If the other party continues to ignore requests or only partially provides documents, the solicitor may need to issue proceedings to subpoena the required documents, ensuring their client’s interests are protected. In summary, due diligence is a vital aspect of dealing with clients in financial matters, and solicitors must remain diligent and proactive to guarantee accurate disclosure and representation.