Sanction Increased For Trust Account “Glaring Irregularities”

A sixty-day suspension was insufficient discipline for trust account irregularities, according to a recent decision of the Michigan Attorney Discipline Board.

During proceedings before the panel, respondent and Ms. Doss, one of respondent’s employees, testified at length regarding bookkeeping, banking and office management procedures. Their combined testimony highlighted “glaring irregularities in the trust accounting for which respondent is responsible.” (HP Report 12/29/14, p 3.) As the panel appropriately summarized, both respondent and Ms. Doss testified that:

1. The system for accounting was poorly managed and not double checked on any regular basis;
2. Respondent paid little attention to whatever system they did maintain, leaving most of that to the bookkeeper;
3. There was a clear disconnect between the bank statements and the internal reconciliations presented during the hearing, reinforcing the idea that no one was paying attention to the Client Trust account, and;
4. Once respondent was made aware that the CP Wind clients wanted their money, he wrote a check and it bounced. [HP Report 12/29/14, p 4.]

The hearing panel’s sanction was increased to 180 days by the Board. (Mike Frisch)

Although we agree with the panel’s assessment of respondent’s mental state, and the application of ABA Standard 4.12, we find that a 60-day suspension is insufficient discipline to impose in light of the misconduct committed. Due to respondent’s cavalier abandonment of his duty to properly manage and oversee client funds, a suspension warranting the filing of a petition for reinstatement pursuant to MCR 9.124 is necessary to ensure public protection.