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HE once lived in a Stevens Road condo.
Now he lives in a three-room Bedok apartment.

Once he was a member of four clubs, including Laguna National Golf and Country Club and Singapore Recreation Club.

Now, he's a bankrupt.

All because his former law firm partner misappropriated money in the firm's clients' account and disappeared with more than $400,000.

Mr Thomas Loh, 43, a former litigation and conveyancing lawyer, ended up having to pay back the firm's clients.

Mr Thomas loh was made a bankrupt trying to clear bets after his partner disconded.-- Pictures: Kelvin Chng

For some in the profession, news of lawyer David Rasif allegedly running away with $10 million has brought back bad memories. (See report on facing page.)

MADE A BANKRUPT

Mr Loh is one who has some of the most bitter memories.

He reportedly had an annual salary of about $150,000, plus bonuses, and drove a Mercedes-Benz E200.

But he lost all that. He had to sell his condo and his club memberships. But it was still not enough.

In 2003, some six years later, he was made a bankrupt.

His problems started when his partner, Lim Yee Kai, then 36, pocketed more than $400,000 in their law firm's clients' account and made off with it in 1997.

Lim was subsequently charged in court with criminal breach of trust, in February 1998.

But he did not turn up in court to face the charges.

He is still on the run.

Mr Loh, however, had to pay the price for his partner's crime.

Under the laws of a partnership, assets and liabilities are borne jointly by the partners.

So he had to repay his partner's debts, and the $270,000 bank overdraft that had been racked up.

Over six years, he fended off legal action, paying off nearly $400,000 to his firm's creditors.

Meanwhile, his life took a downhill spiral.

And this is something he has yet to recover from.

He had his utilities cut off twice, in October last year and April this year, as he could not pay the bills.

His fixed phone line was also cut off twice - in December last year and around March this year.

He gave up his car and club memberships and moved from the Stevens Road condominium, worth $800,000, to a 30-year-old private flat in Bedok, which is financed entirely with his CPF.

COULD NOT PRACTISE

After he had paid off the $400,000 in 2003, he had to find another $85,300 to pay off one company whose money had also been misappropriated.

When he couldn't do that, he was declared a bankrupt by the High Court.

With that, he lost his practising certificate.

And gone was his six-figure annual income.

Now, Mr Loh does freelance work for lawyer friends, usually legal research on a project basis. His average monthly income is about $200.

And he barely makes ends meet.

He has tried to borrow money from family and friends.

But when you are in trouble, he found, people tend to keep their distance.

Sometimes, he has had to turn to his mother for cash.

His wife had to give up her job to stay home and look after their children because they could not afford a maid.

Lim Yee Kai took $413,129 in all between June and September 1997

They have a son, 10, and a daughter, 11.

The family used to go out for meals at clubs or hotels during the weekends, but now they eat at home. With a UK law degree, one would think Mr Loh would have no problems finding a job.

But that has not been the case.

He said: 'I have sent out hundreds of job applications in the last few years. For some reason, I have not been successful.'

Partly because, he said, he is 'quite senior'.

But more than that, he added: 'Bankruptcy is an obstacle.'

And the man to blame for his plight: His former lawyer partner.

VERY SAD

Mr Loh said: 'I'm a victim of my partner's crime.'

Lawyer Peter Cuthbert Low, who represented Mr Loh in a court application for him to continue practising law after his partner went missing, but before he was made a bankrupt, said of his plight: 'I'm very sad for him, his wife and kids, because he was played out by his partner.'

BANKRUPT lawyer Thomas Loh isn't the only lawyer who's had to pay for his partner's sins.

Lawyers Derrick Wong and R Ravindran fell victim too when one of their partners, who was deeply in debt, took money from the firm's clients' account and fled the country in December 1997.

Mr Wong, who has been in practice for over 20 years, was a senior partner in Derrick, Ravi & Partners when Geoffrey Heng Guan Hong ran off with some $3 million.

Mr Wong, Mr Ravindran and their other partner, Mr N Sreenivasan, had to make good the losses.

It is estimated that they may have had to fork out nearly $1 million each, though none of them wanted to reveal the exact amount.

Heng, who is still a wanted man, has not been heard of since.

The Supreme Court has struck him off as a lawyer for 'gross misconduct' and acting in a scandalous manner.

MORAL DEBT

Mr Wong said: 'What can I do now, if I meet him along the streets? I'd probably say: 'You owe me a lot. It's pay-back time.'

'I will say that to make sure he knows he's in debt to us - not only for the money, but also morally.'

Heng, a former SAF scholar, was a high-flying lawyer who was known for his ability to pull in lucrative property deals for the firm.

He ended up cheating some of his clients. He also borrowed money from other lawyers and some clients, telling them various sob stories to pay his gambling debts. He had also duped one of his partners into releasing some of the firm's money to him.

Mr Ravindran told The New Paper: 'It was a nightmare that we want to put behind us, to get on with our lives.

'We had to manage the crisis for three to four months, until we knew what was at the bottom of the pit, or whether we've reached it.'

The professional indemnity insurance for lawyers does not cover cases of fraud.

But Mr Wong, who now runs his own firm, said he and the other two senior partners in the firm felt 'it was honourable for them to bear the cost'.

Mr Ravindran said: 'It was a nightmare. I couldn't sleep for a few nights. We had to pay up from our own pockets.

STUCK TOGETHER
'It had an impact on our families and our friends.'

But they stuck together through the crisis.

It was only a few years later that they each went their separate ways, for their own reasons.

CLIENTS may not end up suffering a total loss even if rogue lawyers scoot off with their money.

If the law firms have other lawyers, they can sue them to claim back some, if not all, of their money.

Even if there are no other partners, there is still some recourse.

The Law Society administers a fund, to which all lawyers contribute to, where victim-clients can go to for some compensation.

But compensation through this fund is discretionary, and the client may not be able to recover fully his losses.

The disappearance of lawyer David Rasif with $10 million of his client's money has led some people to wonder what safeguards there are to avoid more of such incidences.

Mr Derrick Wong, a lawyer in practice for over 20 years said that lawyers hold money for all sorts of purposes, not just for conveyancing deals.

These include holding personal injury payouts, sums that are being disputed over, or for corporate purposes, like security deposits.

However, property deals still make up the bulk of the money going through small- to medium-size law firms.

In this area, lawyers nowadays handle a lot less money than in the early 1990s.

In 1997, rules were passed so that money for transactions involving new private and commercial developments are held by the Singapore Academy of Law.

This has already diverted a large bulk of money from lawyers to SAL, which is headed by the Chief Justice himself.

SAL holds between 5 and 13 per cent, of the purchase price for such properties, depending on the situation.

As at 31 March this year, it was holding about $168 million in stakeholders' money.

With the intervention of SAL, lawyers now handle money only for other private property deals and some HDB deals.

While these rules have reduced significantly the amount of clients' money in law firms, many lawyers still have access to big sums of clients' money.

For example, a foreign client, or a busy client, may just well entrust his lawyer with a lump sum of cash for the property purchase.

In such cases, it may well be that millions of dollars get deposited in the law firm's clients' account.

Following a spate of misappropriation by lawyers in 2002 and 2003, the Solicitors' Accounts Rules were also imposed in 2004.

This means that any withdrawal of clients' money of more than $5,000, must have two signatories, both of whom must be practicing lawyers.

Or, the law practice must engage or employ an approved book keeper to keep its monthly accounts.

While these rules act as a safeguard, they are not foolproof.

Like, if a lawyer really wanted to take the money, there is a window period of a month.

Now, it looks like the rules will be tightened further.

Chief Justice Chan Sek Keong on Wednesday suggested imposing a limit on how much money small firms can hold for clients.

Lawyers themselves want a balance to be struck between protecting the public and allowing a lawyer to carry out his work without too many administrative hindrances.

They argue that the new rules shouldn't be so harsh as to impede the practice and development of small law firms.

As former Law Society president, Mr Peter Cuthbert Low, put it: 'There's impending dread as to the measures that will be imposed to protect the public. It will impact on the manner smaller firms practice.'

But, most lawyers acknowledge that between the extra trouble and the need to preserve public confidence though, the latter weighs out.

Mr Amolat Singh, who runs his own firm, said: 'Handling the money is a necesssary part of acting for a client.

'If I can help it, I'd rather not hold client's money.

'But it is necessary to facilitate the deals that clients want done. The new rules could make things quite 'terok', but lawyers feel it's the lesser of two evils.'

Mr Philip Jeyaretnam, president of the Law Society, said in a statement to The New Paper: 'The legal profession consists of 3,400 lawyers and over 700 law practices and 100 law corporations who everyday protect and advance their clients' interests.

'In 2004, the profession reviewed its rules on holding of clients' money to establish additional internal controls that are more detailed than elsewhere in the Commonwealth.

'The public can rest assured that the Law Society council will investigate David Rasif's conduct, and work with its members and the Chief Justice to determine what further safeguards can be introduced to better protect clients' money.

'The profession will overcome this act of individual lunacy.'