Truro, England — Joyce Gifford, 72, has encountered significant distress after discovering her name had been removed from the ownership of her home following its transfer to a family protection trust. The Cornwall resident had signed over her property to the trust in 2018 with the assurance that it would safeguard her home from being sold to cover care fees, thereby ensuring it could be passed down to her children. The trust was organized by McClure Solicitors, a firm that has since gone bankrupt.
Gifford’s ordeal didn’t come to light until early this year, two years after her husband had passed away and the legal firm had ceased operations. Initially motivated by concern for her husband, who suffered from multiple sclerosis, she was drawn to the trust during a visit from a McClure representative who presented the trust as a protective measure against local authorities claiming their home if they required long-term care.
“I felt sick when I found out,” Gifford said of her shock upon learning the trust made her a beneficiary rather than the owner. Continuous stress and anxiety over the situation have left her struggling to sleep. “I had so much anxiety about it; it was terrible,” she added.
The family protection trust, while sometimes presented as a strategy for asset management , can potentially lead to complications, particularly if local authorities view it as an attempt to shield assets from means testing. Gifford, unaware of these implications, believed she was making a sound decision for her family’s future. In a conversation with a McClure consultant, Gifford recalled being advised to create the trust, which cost nearly £4,500. “They talked about ring-fencing our property, ensuring nothing could be taken,” she said.
In the wake of McClure’s collapse, many former clients have found themselves in similar predicaments. Lee Jackson, 50, also from Truro, turned to a local solicitor after signing his home into a trust with McClure. He and his wife believed they were securing their son’s inheritance but ended up incurring costs exceeding £12,000 to dissolve the trust. Jackson echoed Gifford’s sentiments, describing feelings of heartache and worry as they navigated the fallout from what they were initially told would be a protective arrangement.
“The consultant instilled a fear in us regarding potential inheritance taxes,” Jackson said. “It was distressing to later learn that those claims were baseless.” Through further advice, he discovered the trust held no legal value and posed no threat of inheritance tax, leaving him shocked to see McClure’s name on his property deeds.
The Association of Lifetime Lawyers has stated that asset protection trusts may not be effective for inheritance tax or care fee avoidance. Spokesperson Jade Gani highlighted that while some may find these trusts beneficial, they often involve complex regulations that can entrap individuals instead of providing security.
Following McClure’s bankruptcy, the new custodian, Jones Whyte, has attempted to review the affected trust files, but challenges persist in addressing client concerns. The Solicitors Regulation Authority began an inquiry in response to numerous complaints about McClure’s practices. However, it concluded that no criminal misconduct had been found.
Both Gifford and Jackson fear that other individuals may still be unaware of their precarious situations tied to trusts initiated by McClure. “People are finding out their properties are still locked in these trusts, and it’s horrifying for them,” Jackson said.
In light of these developments, regulators call for stricter oversight of asset protection trust sales. Gani emphasized the importance of seeking independent advice before making any financial commitments regarding such trusts. The ongoing situation serves as a cautionary tale for others considering similar protective measures for their assets.