In a startling development that has sent shockwaves through the legal community, Pragnesh Modhwadia, the former managing partner of national law firm Axiom Ince, has made a shocking admission in an affidavit.
As recently reported in the Law Society Gazette, Modhwadia admitted that an eye-watering £64 million removed from the client account has, for the most part, vanished.
Perhaps the most astonishing aspect of Modhwadia’s affidavit is his admission that “not a single penny” of the £64 million can be accounted for. This revelation prompted Mr. Justice Michael Green to extend a freezing order to cover the full £64 million sum.
Axiom Ince rescued Leeds-headquartered Plexus after the firm collapsed in July, saving 540 jobs.
Axiom Ince had recently suspended Modhwadia, along with two other directors, following an intervention by the Solicitors Regulation Authority, citing suspicions of dishonesty and a failure to comply with Solicitors Act rules. The law firm itself remains operational.
The revelation came during a High Court hearing where Axiom Ince sought to extend a freezing order against Modhwadia in anticipation of filing a claim against him for alleged breach of fiduciary duty. Simon Passfield, representing Axiom Ince, revealed that as of 30 June, at least £57 million was missing from the client account, and since then, an additional £7 million had been transferred.
Modhwadia’s defense is expected to contend against the forthcoming claim from Axiom Ince.
The court also learned that properties purchased or upgraded using these funds were registered under the names of four companies, with Modhwadia being the sole director and shareholder of some, while others were controlled by his brother. To prevent the potential sale of these properties, the court has issued injunctions.
The legal community and clients of Axiom Ince are left stunned by these revelations, and many questions remain about the fate of the missing money and the potential ramifications for the firm and its clients.
Josie Geistfeld
Josie Geistfeld is Editor of Yorkshire Legal News. She welcomes comments and questions.