First of all, I apologise for posting as anonymous. I have only ever asked one question on the forum and received a great deal of useful advice for which I was very grateful. Hopefully, if you read this post the need for anonimity will become apparent.
I have acted for a client for over twenty years. In the first decade or so he was a typical hard working contractor capable of earning a very decent living on short term contracts and our working relationship was good. He has always been a bit challenging (he once phone HMRC to ask if he fell under IR35 who told him he did ; he didn't, and it took me 6 months to persuade them !!). He inherited some money when his father passed away in the mid two thousands and that seems to have been the catalyst for his problems.
Since then he has embarked on a series of get-rich-quick schemes, bad investments and bad choices of business partners. Any potential scam you can think of, I can almost guarantee he has been caught by it - he even had his identity stolen be one of his business partners !! Consequently, he has lost tens of thousands of pounds. In more recent years he has become addicted to the 'educators' forums and events - you know, the "how to buy a property for one dollar" brigade and I have lost count of the number of Ponzies he has 'invested' in.
He always told about these things after he had invested and he was full of enthusiasm about ho rich he was going to become. I always tried (and failed) to persuade him that what he was doing was nonsense but the dollar signs in the eyes made him blind to the obvious.
A couple of years ago during my annual AML work I found that, in addition to his existing (by now, not trading) limited companies he had formed 2 more limited companies and an LLP which he hadn't told me about. At this stage communications between us were few and far between apart from preparing VAT returns and annual accounts for his companies, property accounts and SATRs for him and his wife.
Earlier this year he started sending me elaborate e-mails with links to websites he was involved in (none of which I looked at) which outlined conspiracy theories about the Government and Treasury's involvement in child trafficking and the manipulation of the property market etc etc etc. He refused to sign his 2018 SATR and told me not to file as he was going to 'invoice' HMRC as they owed him a lot more than he owes them. Yes, I know, at this point I should have disengaged but I was also acting for his distraught wife and sought to support her. She signed her SATR and begged and borrowed funds to pay her share of the CGT due on property sales; her husband had spent the sale proceeds paying debts and she did not receive a penny from the profits.
I have not completed his last 2 VAT Returns nor three company and LLP accounts which as due at Co House by 30 September.
Yesterday I received an e-mail from him 'updating' me on his dealing with the Treasury and warning me that the new 5G mobile phone tech also incorporated soft-kill technology into street lights which can be used to eliminate people. This is the last straw - I need to disengage but due to his fragile mental health (he has had at least 2 nervous break-downs in the last 10 years) I need to do this gently.
So, how should I broach this and are there any other issues, due to his involvement with conspiracy theorists and his refusal to file his 2018 SATR, such as filing a SAR. I have no evidence or suspicion of fraud or criminal activity but fear there is a possibility he may be being 'groomed'. Your thoughts and advice would be very much appreciated - I know I will not bne able to respond to replies, and I again apologise for the need for anonimity.
Edit - I forgot to mention that he has been horading very small amounts of gold for when the Government collapses and the money is worthless. He also advised me that many ex-policemen, ex-servicemen etc are being sworn in as Peace Officers ready for the vents of the next 18 months.
BTW - VAT Returns and accounts have not been prepared because he either didn't respond to emails or responded with a 5 page update on his conspiracies.
Edit - Many, many thanks for all your very helpful and constructive replies. I made contact with his wife who seemed more concerned about who would help her with her own tax affairs. She has had to deal with his nervous breakdowns in the recent past and when I suggested she should seek help for him, she just said she could do nothing until 'something happens'. BTW - they are both 60. She knows he is ill but won't do anything about it as she thinks being pro-active will bring on the downward spiral she fears. It's almost like she is preparing to nurture him once he breaks down but she's putting off the inevitable.
So I emailed him yesterday to let him know we are going to disengage; explaining that we have to work within the current tax framework and that we were unable to act for him moving forward. He replied this morning that he understood and he would arrange to collect whatever books and records we have. I will write the formal disengagement letter next week. It has been a stressful few months trying to handle his ever increasing outlandish claims but I sincerely hope his family do the right thing and seek mental health care for him.
Thanks again to everyone who took the trouble to respond. Your advice is well received and very much appreciated.
Edit - Thank you all for the advice. I am waiting for a call/e-mail from client about the few books and records we have. I will arrange a time when I will not be alone and I will ceretainly not engage in discussions about his conspicacy theories. I will be handing him his records and wishing him well. I will post a final edit once he has left the office.