California State Bar Suspends Over 1600 Lawyers

Upholding Trust and Accountability in Legal Practice

The California State Bar has taken decisive action in response to recent events involving Thomas Girardi, a disgraced attorney accused of embezzling millions of dollars from his clients. In an effort to safeguard client funds, the Client Trust Account Protection Program was implemented last year, mandating attorneys to register their trust accounts annually and adhere to strict guidelines for the responsible management of these funds.

Ensuring Compliance Through Proactive Measures

To ensure compliance, attorneys are required to complete a yearly self-assessment of their trust account practices and certify their understanding of the safety requirements imposed by the state bar. Once the reporting component is fulfilled, the state bar conducts compliance reviews and investigative audits as necessary.

Numbers Declining as Compliance Increases

Originally, more than 1,700 attorneys were found to be in violation of the trust account rules and were subsequently labeled as “inactive,” rendering them unable to practice law. However, as of Thursday afternoon, the number of suspended attorneys has dropped to 1,641, as some have taken steps to fulfill the necessary requirements. Steven Moawad, Special Counsel for the bar’s attorney discipline system, emphasizes that these suspensions are administrative in nature and not indicative of any misconduct or misappropriation of client funds.

“The Essence of Noncompliance”

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According to Moawad, the noncompliance stems from a failure to report rather than acts of malfeasance. He suggests that some attorneys may have chosen not to report due to concerns surrounding their trust account activities, such as potential mismanagement or misappropriation. Alternatively, a lack of reporting could also be attributed to factors such as non-disclosure of the attorney’s passing, as the state bar currently lacks a comprehensive database to track this information.

Consequences for Noncompliance

Attorneys were granted a period from December 1st to April 3rd to comply with the new regulations. Failure to do so resulted in a $75 noncompliance fee and a June 30th deadline for rectification. Attorneys who remained noncompliant and failed to submit the requisite documentation by July were subsequently suspended and placed in inactive status.

Responding to the Girardi Saga

Moawad acknowledges that the implementation of the Client Trust Account Protection Program was partly in response to the misconduct allegations against former attorney Thomas Girardi. Girardi, aged 84, was indicted earlier this year on fraud charges, accused of misappropriating more than $18 million from his clients. This program aims to educate and reinforce the responsibilities of attorneys regarding client trust accounts.

A Systematic Overhaul

Thomas Girardi’s case has prompted significant introspection within the State Bar of California. The state Supreme Court revoked Girardi’s law license last year, with the State Bar acknowledging its mishandling of allegations against him over several decades. Recognizing the gravity of Girardi’s actions, the bar emphasizes the need for improved oversight and prevention of similar abuses in the future.

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From Controversy to the Silver Screen

Girardi gained national notoriety when his now-defunct firm, Girardi & Keese, secured a landmark settlement against Pacific Gas & Electric. The company was forced to pay $333 million to residents of Hinkley, who suffered from health issues caused by contaminated water. This case inspired the acclaimed 2000 film “Erin Brockovich,” starring Julia Roberts.

The Road Ahead

Despite being diagnosed with Alzheimer’s disease, a recent assessment deemed Girardi mentally fit to stand trial. If convicted, he faces the prospect of a lengthy prison sentence. In light of these events, the State Bar of California is committed to upholding the integrity and professionalism of its attorneys.

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