by Brian Mahany
The press releases from the U.S. Attorney’s Office in Manhattan yesterday did not reflect well on either the legal or accounting professions. In one case, a New Jersey lawyer was convicted in federal court of an investment fraud scheme. In the other, a former partner and CPA from accounting giant Grant Thornton was charged with stealing $4 million in client funds. If there is any good news to these stories, it is that Grant Thornton and not the clients are the victims.
Accountants, lawyers and other professionals make mistakes. Even doctors make mistakes. It is the human condition; none of us are perfect. Reputable professionals maintain malpractice or errors and omissions insurance. Unfortunately, most insurance does not cover intentional acts.
Missing a deadline or giving bad accounting advice is negligence. It is a mistake. Stealing monies from clients, however, is theft.It’s the difference between being a bad lawyer and a thief or an accountant who misread a code section and a criminal.
In the Grant Thornton story, prosecutors say that Craig Haber of Manhattan had clients of the accounting firm send checks to his office. He created a bank account with a very similar name and deposited the checks into his own accounts. It was not sophisticated and actually surprising that it took Grant Thornton almost 8 years to discover the theft. He was fired after being caught last summer.
Thus far, Haber has simply been indicted. That means a Grand Jury believes there is reasonable basis to think he committed the crime. Of course, he remains innocent until proven guilty.
U.S. Attorney Preet Bahara said, “From his perch at a prestigious accounting firm, Craig Haber allegedly betrayed his partners, by deceiving the firm’s clients in order to rob the firm blind – diverting millions of dollars of client payments into his own pocket. Fraud is always serious, but it is especially alarming when, as alleged here, it is committed by professionals who are supposed to be gatekeepers responsible for ensuring financial rectitude.”
His comments were echoed by U.S. Postal Inspector Service Inspector-in-Charge Keith Milke who said: “Mr. Haber’s alleged abuse of the trust given to him by his clients and employer is a classic example of greed overcoming honest business practices. His arrest should serve as a reminder that whenever someone uses the US Mail for illegal activities Postal Inspectors will bring them to justice.”
Unfortunately, “whenever” someone commits a crime they don’t get arrested. Professionals do often get disbarred or lose their professional licenses, however. If you were the victim of a bad accounting, bad lawyering or worse, give us a call.
Many lawyers won’t sue another lawyer. We will. As fraud lawyers, we understand there are a few bad apples in this world and they come from all walks of life. Whether your accountant made an honest mistake or just decided to steal, if we take your case, we will take it as far as we can.
For more information, contact attorney Brian Mahany at brian@mahanyertl.com or by telephone at (414) 704-6731 (direct). All inquiries are protected by the attorney – client privilege and kept in confidence.
Mahany & Ertl – America’s Fraud Lawyers. Offices in Milwaukee, Wisconsin; Detroit, Michigan; Portland, Maine; Minneapolis, Minnesota and San Francisco, California. Fraud recovery available in many jurisdictions.
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