New rules to protect conveyancing money kick in Aug 1

From August 1, the Ministry of Law (MinLaw) will be implementing new measures to safeguard conveyancing money from rogue lawyers.

In a news release, the Ministry of Law said: “With the new measures, clients’ money in conveyancing transactions will enjoy a higher standard of protection.”

Under the new rule, lawyers will no longer be allowed to receive and hold monies used for purchase or sales of properties unless they are deposited in a specific conveyancing account with five appointed banks, kept with the Singapore Academy of Law (SAL) under its Conveyancing Money Service or placed in an escrow account jointly opened by lawyers acting for the respective parties.

The five appointed banks are Bank of China, DBS Bank, Oversea-Chinese Banking Corporation (OCBC), The Bank of East Asia, and United Overseas Bank (UOB).

Lawyers who violate this provision may be fined up to $50,000 or jailed for a term not exceeding three years, or both.

They could also face disciplinary proceedings under the Legal Profession Act, the ministry said.

Conveyancing monies are used to pay stamp duties, option deposits, and balance of sales proceeds. Cases of lawyers running away with clients’ conveyancing monies have prompted a public consultation and pilot trials of the new measures.

Property buyers and sellers who opt to have their lawyers hold their conveyancing money should deposit the money into the law firm’s conveyancing account using the suffix, “-CVY” after the law firm’s name.

For clients who choose to use SAL’s Conveyancing Money Service, the agency has set up an electronic Payment Instructions service (ePI). This is to enable efficient and secure system for initiating and countersigning payment instructions for the withdrawal of the conveyancing accounts or SAL.

MinLaw said it had embarked on several outreach activities to prepare lawyers for the smooth implementation of the new rules.

Source : Channel NewsAsia – 31 Jul 2011

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