Advisers and trustees – risk and fraud awareness in the wake of covid-19
While the full extent of the fallout from covid-19 on the global economy is yet to be seen, history has shown that recessions often uncover and act as a catalyst for fraud.
This, coupled with the fact that past economic downturns have shown us that those negatively impacted by portfolio losses will scrutinise the actions of those managing their assets, means that litigation is likely on the horizon.
As fiduciaries, trustees are guided by the responsibilities imposed upon them under the relevant law, contract or trust instrument but, in essence, they are duty-bound to act in the best interests of the beneficiaries. Financial intermediaries and advisers are also likely to have duties to their clients imposed upon them, either by way of their contractual terms with their clients or through general fiduciary duties that arise as a matter of law.
Of Counsel Amy Harvey discusses in International Adviser.