Thursday, March 28, 2013

Stealing From Partners Draws Disbarment In Oregon

The Oregon Supreme Court rejected a trial panel's one-year suspension order  and disbarred an attorney for criminal and dishonest conduct in his dealings with his partners.

The attorney made law firm shareholder distributions to himself and told his partners "that the firm lacked sufficient funds to make any distribution [to them]." The firm's accountant noticed the disparity while preparing the firm's 2007 corporate tax returns and notified the other partners.

The attorney promised to repay the debt and wrote an e-mail to his partners with a "mea culpa" subject line. He did not tell the partners that he had taken additional amounts that the accountant had not uncovered.

Then, the attorney went on a vacation to Hawai'i. While he was away, a partner and the firm's bookkeeper discovered that he used a firm credit card to pay his personal expenses.

The court concluded

...the distinction between business and personal expenses may not have always been precise, and there may have been a few, relatively minor instances where another partner failed to honor the distinction. However, those few instances provided no reasonable basis for the accused to believe that he was either entitled or authorized to take approximately $100,000 of the firm's funds to pay for remodeling his home, family vacations, and the like. Indeed, the act that the accused intentionally misrepresented his reasons for charging personal expenses to the firm is at odds with the claim that he reasonably believed he was entitled to do so.

(Mike Frisch)

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