Pennsylvania Lawyer Suspended for Failing to Act Promptly as his Partner Stole Funds from Clients

/ 26.Mar, 2012

Last month, Pennsylvania attorney Lawrence Rubin was suspended for practicing for one year for failure to act promptly when faced with suspicious behavior relating to his now-disbarred partner’s use of multiple clients’ settlement funds for his own personal use.

The disciplinary board noted that Rubin must have been made aware of his partner’s inappropriate use of the settlement funds due to various red flags that began in 2004. In 2004, Rubin became aware of one to two week delays in his partner’s disbursement of settlement funds to clients. Following this, he had to periodically remind his partner to distribute settlement proceeds to clients. In addition, when Rubin inquired about the delays in distribution, his partner frequently responded by stating that the funds would be distributed “next week.” On one occasion, Rubin’s partner responded by stating that he would “come up with the money.” Furthermore, around 2006, Rubin’s monthly compensation severely decreased. The board found that Rubin should have known that his partner was stealing funds due to the excuses he repeatedly made about the delays in distribution to clients, the multiple delays in distribution of clients’ settlement proceeds, and his reduction in monthly compensation.

The Pennsylvania Supreme Court found that Rubin violated a total of six Pennsylvania Rules of Professional Conduct including 1.2(a), 1.4(a)(2), 1.4(a)(3), 1.4(b), 1.15(b), and 8.4(c).  Due to Rubin’s cooperation with authorities and efforts to compensate the clients, such as by utilizing the firm’s income to repay substantial amounts stolen by his partner, the court did not impose more severe sanctions on Rubin.

Josh J.T. Byrne, Esquire and Shilpa Kadoo