Never Again

The New York Appellate Division for the Second Judicial Department has ordered the public censure of an attorney for an escrow account issue

In 2018, Chase Bank erroneously debited $180,000 from the escrow account pursuant to a check that was issued for $100,000. This error caused the rolling shortage referenced in charge one and was not detected until 2020. Because of this shortage, in 2018, five checks in small amounts also were dishonored from the escrow account. According to the respondent, because [Respondent’s law partner] Ali had a good relationship with Chase Bank, Ali convinced the bank not to report the dishonored checks. The respondent learned after the incidents that Ali had transferred funds from an operating account of the law firm into the escrow account to cover the deficiencies. The record does not reflect that dishonored check notices were issued by Chase Bank.

In reflecting on the misconduct that led to the Grievance Committee initiating a disciplinary proceeding, the respondent states

“I will never issue an escrow check for the rest of my life. My practice doesn’t require any escrow at all. And two, just thinking about closing the barn door after the horse has left, I should have been more vigilant. I should not have accepted what Mr. Ali was telling me at face value. I should have looked for reconciliation. I should have been more aware. I should have been more aware of my duties and I did not do my duties. All I can say is it wasn’t intentional and I had no intent to hurt any of my clients, and I also learned that I have a duty, not just an ethical obligation but a moral obligation to make sure that the money that is still present is safeguarded and contained or reach out to the people who did not cash those checks.”

The respondent stated that he did not realize how poorly the escrow account was managed until the investigation by the Grievance Committee began and he was asked to provide records and ledgers associated with the escrow account. According to the respondent, he previously had reviewed the escrow account records, but since hundreds of checks were being issued involving transactions of approximately $45 million dollars, he did not fully understand the account records.

The respondent explained that his area of practice involves public interest work. He represents Sikh Temples in Manhattan and Nassau County. He also represents victims of domestic violence in both criminal court and family court and performs some landlord/tenant work. He is the general counsel for an organization called United Sikhs. One character witness was called to testify in mitigation and the respondent provided eight character affidavits in support of his good character and reputation.

In a report dated May 23, 2024, the Special Referee sustained both charges and found that the respondent took full responsibility for his misconduct and acknowledged he should have taken steps to ensure that the fiduciary funds in the escrow account were protected.

(Mike Frisch)