Report 2022-030 All Recommendation Responses

Report 2022-030: The State Bar of California's Attorney Discipline Process: Weak Policies Limit Its Ability to Protect the Public From Attorney Misconduct (Release Date: April 2022)

Recommendation for Legislative Action

To improve the independence and objectivity of the semiannual review of the State Bar of California (State Bar) case files, the Legislature should require the State Bar to do the following:

-Regularly change its external reviewer.

-Have its external reviewer present its findings and recommendations, with all confidential information redacted, directly to the Board of Trustees of the State Bar (board).

-Require the State Bar to report periodically to the board on the actions it takes to address the external reviewer's recommendations.

Description of Legislative Action

As of November 4, 2022, the Legislature has not taken action to address this specific recommendation.

California State Auditor's Assessment of 6-Month Status: No Action Taken

Description of Legislative Action

As of October 3, 2022, the Legislature has not taken action to address this specific recommendation.

California State Auditor's Assessment of 60-Day Status: No Action Taken

As of October 3, 2022, the Legislature has not taken action to address this specific recommendation.

Recommendation for Legislative Action

To ensure that the State Bar implements the policy and procedure changes identified in this audit, the Legislature should require an assessment by no later than December 2023 of the State Bar's compliance with those policies and procedures.

Description of Legislative Action

As of November 4, 2022, the Legislature has not taken action to address this specific recommendation.

California State Auditor's Assessment of 6-Month Status: No Action Taken

Description of Legislative Action

As of October 3, 2022, the Legislature has not taken action to address this specific recommendation.

California State Auditor's Assessment of 60-Day Status: No Action Taken

As of October 3, 2022, the Legislature has not taken action to address this specific recommendation.

Recommendation #3 To: Bar of California, State

To ensure that it uses nonpublic measures to close complaints only when such use is consistent and appropriate, the State Bar should revise its policies by October 2022 to define specific criteria that describe which cases are eligible to be closed using nonpublic measures and which are not eligible.

1-Year Agency Response

Effective October 31, 2022, the Office of Chief Trial Counsel (OCTC) put in place a revised policy governing use of nonpublic measures to close complaints that defines specific criteria that describe which cases are and are not eligible to be closed using nonpublic measures and, for cases that are eligible, how discretion should be exercised in determining whether closure with a nonpublic measure is appropriate. OCTC presented a summary of its new policy to the Board of Trustees at its January 2023 meeting.

California State Auditor's Assessment of 1-Year Status: Fully Implemented

6-Month Agency Response

The State Bar has identified and assessed factors to specify eligibility criteria for nonpublic alternatives to discipline and is drafting revised guidance for exercise of staff discretion in use of these alternatives.

California State Auditor's Assessment of 6-Month Status: Pending

We will assess the State Bar's progress toward implementing this recommendation upon the submission of its revised guidance.

60-Day Agency Response

The State Bar is currently identifying and assessing factors to be used to specify eligibility criteria for nonpublic alternatives to discipline after which it will turn to revising guidance for exercise of staff discretion in use of these alternatives.

California State Auditor's Assessment of 60-Day Status: Pending

We look forward to reviewing the State Bar's revised guidance after it is finalized.

Recommendation #4 To: Bar of California, State

To ensure that it fulfills its duties to investigate attorney misconduct, by April 2023, the State Bar should begin monitoring compliance with its new policy for identifying the circumstances in which investigators should continue to investigate even if the complainant withdraws the complaint.

1-Year Agency Response

In March 2023, OCTC conducted a random audit of files closed using the new closing codes "NSF-CW- Resolution," "NSF-CW-Uncooperative," and "NSF-CW-Withdrawal" to check whether these three codes were being used following OCTC's new policy for identifying circumstances in which investigators should continue to investigate even if the complainant withdraws the response. The Mission Advancement & Accountability Division (MAAD) provided OCTC with a random sample of 30 cases closed between February 2022 and March 2023 for each code. OCTC staff reviewed the substance of the file in each case, including the complaint and closing letter(s), to determine: (a) was the proper closing code used; (b) was it appropriate to close the case based on the CW withdrawing their complaint or otherwise being non-cooperative (whether because of a resolution with R or for any other reason) because without the CW's cooperation OCTC would not be able to develop facts sufficient to prove a disciplinary violation by clear and convincing evidence; and (c) did the closing letter(s) accurately and sufficiently explain the reasons for closing. The results of this random audit indicated the following: (a) the correct closing code was used in at least 90% of the cases for each of the three closing codes; (b) closure was appropriate in at least 90% of the cases for each of the three closing codes; and (c) closing letters accurately and sufficiently explained the reasons for closing in at least 93% of the cases for each of the three closing codes. While reviewing the closing letters, it was noted that six failed to include information advising the complainant of the ability to seek review from the Complaint Review Unit. Given this, and the results of the closing code audit, OCTC will conduct training that will cover the situations in which each of the three closing codes should be used and emphasize the need for closing letters to be complete and include information regarding available review.

California State Auditor's Assessment of 1-Year Status: Pending

We disagree with the State Bar that its actions have fully implemented our recommendation. We recommended that it monitor whether its investigators are following its policy for continuing to investigate cases even if the complainant withdraws the complaint. Although the State Bar selected a relatively small number of cases for review, that review indicates that as much as 10 percent of cases were inappropriately closed. For this reason, we continue to recommend that the State Bar perform ongoing monitoring to ensure that it is fulfilling its responsibility to investigate attorney misconduct and is not prematurely closing cases that should be investigated.

6-Month Agency Response

OCTC's new policy and the modified closing codes remain in place. The State Bar's new Office of Compliance will collaborate with OCTC staff to develop a periodic compliance monitoring program based on the new OCTC policy. Compliance monitoring shall be facilitated through the use of a new Compliance Monitoring Template to be developed. Monitoring will involve random sampling of closed cases during the prior six months to include verification of closing reasons and relevant codes. Using this approach, we will ensure that cases marked "closed" were based on the sufficiency of the evidence and not the complainant's withdrawal of the matter or their failure to cooperate in the investigation.

California State Auditor's Assessment of 6-Month Status: Pending

60-Day Agency Response

OCTC's case management system requires, at case closure, the entry of a code for which a reason for closure must be selected from a drop-down menu. The reasons for closure were modified to accord with the new policy to make clear that a complainant's withdrawal of or failure to cooperate in the investigation of their complaint was not alone a sufficient basis for closure. For example, the case management system previously included the following reasons for closure: "Matter Resolved Between CW," "CW's Failure to Cooperate," and "Withdrawal." These three reasons for closure were modified to make clear that closure requires an evaluation of the sufficiency of the evidence and now read as follows (with "NSF" an abbreviation for insufficient evidence): "NSF-CW Resolution," "NSF-CW Uncooperative," "NSF-CW Withdrawal." Similar modifications have been made to other relevant closing reasons. OCTC will develop a system to monitor compliance with the new policy by conducting a randomized review of cases using the new closing reasons to ensure that closure is in fact based on the sufficiency of the evidence and not alone on the complainant's withdrawal of or failure to cooperate in the investigation.

California State Auditor's Assessment of 60-Day Status: Pending

The State Bar's response does not address the underlying issue this recommendation is intended to address. Altering closing codes to state that there is insufficient evidence to pursue a case does not address our concern that the State Bar's case closure determinations are based on the complainant withdrawing from the process, not the sufficiency of evidence. We reviewed closed cases in which the State Bar had evidence where it could have pursued discipline for misconduct without the cooperation of the complainant. This recommendation is intended to ensure that the State Bar monitors the actions of its staff to prevent such cases from being closed prematurely.

Recommendation #5 To: Bar of California, State

The State Bar should notify the public on its website when other jurisdictions have determined that an attorney who is also licensed in California presents a substantial threat of harm to the public.

6-Month Agency Response

At its July 2022 meeting, the Board of Trustees adopted a revised policy for posting on the State Bar's website of notices regarding disciplinary actions by other jurisdictions as follows: (1) a consumer alert when another jurisdiction has imposed an interim suspension or involuntary inactive status (or its equivalent) pending that jurisdiction's final determination regarding discipline; (2) a consumer alert when another jurisdiction has made a finding that the attorney should be suspended or disbarred, even if that finding remains subject to review or appeal; (3) a consumer alert when another jurisdiction has issued a final order for suspension or disbarment, even if the State Bar has not yet filed a notice of disciplinary charges based on that final order; and (4) a notation when another jurisdiction has issued a final order imposing discipline less than suspension or disbarment, even if the State Bar has not yet filed a notice of disciplinary charges based on that final order. See submitted supporting documents: July 2022 Board Agenda Item 704; September 2022 Board Agenda Item 10.

California State Auditor's Assessment of 6-Month Status: Fully Implemented

60-Day Agency Response

Staff proposed a policy for posting of consumer notices at the Board of Trustee's May 2022 meeting. Two Trustees are working with the Chief Trial Counsel to finalize the policy for proposed adoption at the Board's July 2022 meeting.

California State Auditor's Assessment of 60-Day Status: Pending

We look forward to reviewing the policy for posting these notices once it is adopted.

Recommendation #6 To: Bar of California, State

To ensure that it identifies discipline imposed on California attorneys in other jurisdictions, the State Bar should use the American Bar Association's data bank to identify attorneys disciplined in other jurisdictions who have not reported that discipline to the State Bar.

60-Day Agency Response

The Intake team's management (one Assistant Chief Trial Counsel (ACTC) and two supervising attorneys) registered and obtained access to the ABA data bank effective February 2022. The Assistant Chief Trial Counsel registered to receive automated emails prior to April 1, 2022, and, as of June 1, 2022, one supervising attorney did so as well. The second supervising attorney is out [REDACTED] but will register when she returns.

California State Auditor's Assessment of 60-Day Status: Fully Implemented

Recommendation #7 To: Bar of California, State

To allow its staff to more easily identify patterns of similar complaints made against attorneys, by July 2022, the State Bar should begin using its general complaint type categorizations when determining whether to investigate a complaint.

1-Year Agency Response

In November 2022, MAAD completed its design and put into production an interactive dashboard based on data drawn from OCTC's case management system that allows OCTC attorneys to search by attorney name or bar number to identify all pending open and prior closed complaints for that attorney (exempting closed complaints that, in accordance with State Bar policy, have been archived to address concerns about racial disparities in the discipline system). The dashboard provides a graph showing the breakdown of current and prior cases grouped by general category and allows access to more specific information for each complaint within any category. On November 16, 2022, at an OCTC all-staff meeting, Assistant Chief Trial Counsel William Todd provided a demonstration on how to use the dashboard. On December 1, 2022, OCTC circulated to all staff an email with a link to access instructions for using the dashboard and the dashboard itself.

California State Auditor's Assessment of 1-Year Status: Fully Implemented

The State Bar provided instructions describing for its staff how to use the dashboard it has created and a screenshot of the dashboard for an example attorney. The instructions describe categories for allegations and the screenshot shows the aggregate number of allegations in each of these categories for the example attorney. Based on this evidence, we consider the recommendation to be fully implemented.

6-Month Agency Response

The State Bar's Office of Research and Institutional Accountability has designed an interactive dashboard based on data drawn from OCTC's case management system that allows OCTC attorneys to search by attorney name or bar number to identify all pending open and prior closed complaints for that attorney (exempting closed complaints that, in accordance with State Bar policy, have been archived to address concerns about racial disparities in the discipline system). The dashboard provides a graph showing the breakdown of current and prior cases grouped by general category and allows access to more specific information for each complaint within any particular category. See supporting document - "Prior Complaint Patterns DRAFT". It contains redacted confidential disciplinary investigation information that is confidential, pursuant to Business & Professions Code section 6086.1(b)). The dashboard has been designed and tested. Methodology and instructions for staff use are being drafted. Once these are complete, training will be provided to OCTC staff, and the dashboard will be implemented to enable OCTC investigators and attorneys to ascertain whether a current complaint implicates an attorney with a pattern of prior complaints in any of the general complaint type categories.

California State Auditor's Assessment of 6-Month Status: Pending

The State Bar's draft dashboard appears to provide comprehensive information that addresses the finding that prompted our recommendation. We look forward to reviewing the final version upon its implementation.

60-Day Agency Response

The State Bar's Office of Research and Institutional Accountability is designing an operational report based on data drawn from OCTC's case management system that will identify open cases that are based on the same complaint type as previously closed complaints using the newly created complaint categories. This report will be sortable by attorney. Once the report is designed and tested, it will be generated on a regular basis and made available to OCTC investigators and attorneys so that they can ascertain whether a current complaint implicates an attorney who has a pattern of prior complaints in any of the general complaint type categories.

California State Auditor's Assessment of 60-Day Status: Pending

The State Bar's response does not provide sufficient detail to determine whether the information will be provided on a timely basis. We look forward to reviewing the report and the State Bar's policies and procedures related to creating and providing the report to its staff.

Recommendation #8 To: Bar of California, State

To improve its ability to identify and prevent conflicts of interest that its staff may have with attorneys who are subjects of complaints, the State Bar should develop a process by July 2022 for monitoring the accuracy of the information in its case management system used to flag attorneys with whom its staff have declared a conflict of interest.

1-Year Agency Response

This recommendation was fully implemented as reported in the 6-month update and response to follow up question at that time.

California State Auditor's Assessment of 1-Year Status: Partially Implemented

As described in our assessment of the State Bar's 6-month update, it did not provide documentation of the link between it's conflict of interest database and its case management system. The examples that it provided were not sufficient for us to conclude that the case management system consistently flags potential conflicts of interest. As we described in our report, in some cases, the State Bar's case management system reflected that an attorney was on State Bar's conflicts list, and in other cases it did not. Thus, we need documentation that illustrates how the State Bar's updated process consistently results in all potential conflicts being accurately reported in its case management system, rather than a selection of instances in which this occurred.

6-Month Agency Response

The IT processes to coordinate the COI database with OCTC's case management system and ensure that in the case management system, a flag is placed on the person record of each attorney with whom a conflict has been identified in the COI database were completed in September 2022. The State Bar revised the COI database's questions to identify conflicts. On September 26, 2022, Human Resources circulated new Administrative Advisory 22-05: Rule 2201 Conflict of Interest Compliance, which requires all staff, contractors, and Board members to use the revised questions to create an initial compliance questionnaire or update their existing one in the COI database by no later than October 14, 2022. See supporting documents: Administrative Advisory 22-05; HR email regarding Administrative Advisory 22-05.

California State Auditor's Assessment of 6-Month Status: Partially Implemented

The State Bar has not yet provided documentation of the link between its conflict of interest database and its case management system. We look forward to reviewing this documentation during our next evaluation of its progress.

60-Day Agency Response

To ensure accuracy of information in the case management system, the State Bar's Information Technology group has initiated processes that: (1) update the conflict of interest (COI) application (the application where State Bar employees enter attorney relationship information) to apply the current 2201 rules for all State Bar affiliates and determine if and how an attorney should be flagged; (2) update attorney records in the case management system so that they reflect the correct flag as set in the COI application; (3) clean up existing flags in both the COI application and case management system at the attorney level; and (4) create a report to compare the COI application and case management system and ensure that they are in sync. OCTC also issued a new policy directive, effective June 1, 2022, implementing procedures that require investigators and attorneys to perform conflict checks and enter the results of those conflict checks into the case management system both at the time of assignment and prior to closure.

California State Auditor's Assessment of 60-Day Status: Pending

The State Bar indicated that it is working to implement the processes listed in its response. We look forward to reviewing the results of this work.

Recommendation #9 To: Bar of California, State

To ensure that State Bar staff do not inappropriately close cases against attorneys on the conflict list, the State Bar should create a formal process by October 2022 for determining whether it is able to objectively assess whether such a complaint should be closed or whether the decision should be made by an independent administrator. The State Bar should document this assessment in its case files for each case against an attorney on the conflict list.

60-Day Agency Response

OCTC issued a new policy directive, effective June 1, 2022, implementing procedures that require investigators and attorneys to perform conflict checks and enter the results of those conflict checks into the case management system both at the time of assignment and prior to closure. The policy requires that if a potential conflict is identified, it is referred up the supervisory chain, and to the Special Deputy Trial Counsel as necessary, to resolve the potential conflict.

California State Auditor's Assessment of 60-Day Status: Fully Implemented

Recommendation #10 To: Bar of California, State

To increase the independence and objectivity of the external review of its case files, the State Bar should amend its policies by July 2022 to require its external reviewer to select the cases for the semiannual review.

6-Month Agency Response

As of July 18, 2022, OCTC revised its policy directive regarding the semi-annual random audit of closed cases to provide that the external auditor, rather than OCTC, shall randomly select the cases for review with the assistance of the Office of Research and Institutional Accountability. As revised, the relevant portion of the policy now states: "Twice each year, the retained external auditor, with the assistance of ORIA, will randomly select at least 290 files that have been closed during the six months to which the audit pertains (either March 1 through August 31, or September 1 through the end of February)." See supporting document: OCTC Policy Directive 2022-01, revised July 18, 2022.

California State Auditor's Assessment of 6-Month Status: Fully Implemented

60-Day Agency Response

Staff are currently revising these policies and procedures.

California State Auditor's Assessment of 60-Day Status: Pending

Recommendation #11 To: Bar of California, State

To increase the independence and objectivity of the external review of its case files, the State Bar should amend its policies by July 2022 to establish formal oversight to ensure that it follows up and addresses the external reviewer's findings.

1-Year Agency Response

The agenda item withdrawn from the September RAD agenda was heard by the entire Board, sitting as RAD, at the November 2022 Board Meeting. In addition, the results of another random audit were received and a report on these results will be the subject of a Board agenda item at the March 2023 Board Meeting. Both agenda items propose a schedule for OCTC to report back to the Board on its implementation of the random audit recommendations. As noted in the March 2023 Board agenda item, reporting on many of the recommendations from the earlier audit was originally to be done in January and March 2023, but that reporting has been postponed to May 2023 given the intervening audit report. See supporting documents: November 2022 Board Agenda Item 60-2; March 2023 Board Agenda Item 60-2.

California State Auditor's Assessment of 1-Year Status: Fully Implemented

The State Bar previously revised its policies regarding the external review of past cases that it contracts for. Based on the documentation it submitted with this response showing that it provided the results of its external review to its board, we consider the recommendation to be fully implemented.

6-Month Agency Response

As of July 18, 2022, OCTC revised its policy directive regarding the semi-annual random audit of closed cases. See supporting document: OCTC Policy Directive 2022-01, revised July 18, 2022. In accordance with this new policy, an agenda item reporting on the most recent random audit was prepared for the September 2022 meeting of the Regulation and Discipline (RAD) Committee; the report proposed a schedule for OCTC to report back to the Board on its implementation of each of the random audit's recommendations. See supporting document: September 2022 RAD Agenda Item IIIA. The agenda item was withdrawn from the September RAD agenda in light of the Board's decision to have the entire Board sit as the RAD at subsequent meetings. The agenda item will be rescheduled for the November 2022 Board meeting.

California State Auditor's Assessment of 6-Month Status: Partially Implemented

Our evaluation of the State Bar's implementation of this recommendation is pending documentation of it providing the results of its external audit to its board.

60-Day Agency Response

Revisions of policies/procedures to create a system for formal monitoring of and reporting on implementation actions taken in response to the random audit are underway. Retention of additional external auditors without prior connections to OCTC will require additional financial resources.

California State Auditor's Assessment of 60-Day Status: Pending

We look forward to reviewing the State Bar's revised policies and procedures.

Recommendation #12 To: Bar of California, State

To ensure that it appropriately reviews complaints involving overdrafts and alleged misappropriations from client trust accounts the State Bar should, by July 2022, discontinue its use of informal guidance for review of bank reportable actions and direct all staff to follow the policies established in its intake procedures manual (intake manual).

60-Day Agency Response

The Assistant Chief Trial Counsel overseeing the Intake team (where review of bank reportable actions occurs) met with relevant staff and directed that they comply with polices established in the intake manual and discontinue use of informal guidance.

California State Auditor's Assessment of 60-Day Status: Fully Implemented

The State Bar provided an agenda indicating that the intake manual and intake procedures were discussed at an intake team meeting.

Recommendation #13 To: Bar of California, State

To ensure that it appropriately reviews complaints involving overdrafts and alleged misappropriations from client trust accounts, the State Bar should by July 2022, revise its intake manual to disallow de minimis closures if the attorney has a pending or prior bank reportable action or case alleging a client trust account violation.

1-Year Agency Response

The pilot project was extended to ensure that a sufficient number of cases are handled to provide meaningful data. As a result, the pilot project remains ongoing. Data collection and evaluation is expected to be completed in April 2023, following which any revisions to de minimis closure policies will be made and a monitoring system for compliance with these policies established

California State Auditor's Assessment of 1-Year Status: Pending

We look forward to reviewing the results of this pilot project upon its completion.

6-Month Agency Response

A pilot project for partial implementation of this recommendation was initiated effective August 1, 2022. See supporting documents: CTA/Bank RA Pilot Program Protocol; Pilot Program Protocols.

California State Auditor's Assessment of 6-Month Status: Pending

We look forward to reviewing the results of this pilot project upon its completion.

60-Day Agency Response

Following a June 2, 2022, discussion with the State Auditor regarding resources needed for full implementation of this recommendation, the State Bar is developing a pilot project for partial implementation that will provide necessary data for better assessing resource needs. This pilot project will be developed by July 2022.

California State Auditor's Assessment of 60-Day Status: Pending

Recommendation #14 To: Bar of California, State

To ensure that it appropriately reviews complaints involving overdrafts and alleged misappropriations from client trust accounts the State Bar should, by July 2022, establish a monitoring system to ensure staff are following its policies for de minimis closures.

1-Year Agency Response

The pilot project was extended to ensure that a sufficient number of cases are handled to provide meaningful data. As a result, the pilot project remains ongoing. Data collection and evaluation is expected to be completed in April 2023, following which any revisions to de minimis closure policies will be made and a monitoring system for compliance with these policies established.

California State Auditor's Assessment of 1-Year Status: Pending

We look forward to reviewing the results of this pilot project upon its completion.

6-Month Agency Response

A pilot project for partial implementation of this recommendation was initiated effective August 1, 2022. See supporting documents: CTA/Bank RA Pilot Program Protocol; Pilot Program Protocols.

California State Auditor's Assessment of 6-Month Status: Partially Implemented

The State Bar has begun a pilot program in which it will review a sample of client trust accounts cases, regardless of the amount of the violation, and will seek bank records for each case. We look forward to reviewing the results of this pilot program. However, the State Bar continues to close other cases as de minimis. The State Bar should establish some type of monitoring to ensure that those de minimis closures are in alignment with its existing policies.

60-Day Agency Response

Following a June 2, 2022, discussion with the State Auditor regarding resource needs for full implementation of this recommendation, the State Bar is developing a pilot project for partial implementation that will provide necessary data for better assessing resource needs. The pilot project will include monitoring based on case management system data for de minimis closures and will be developed by July 2022.

California State Auditor's Assessment of 60-Day Status: Pending

Recommendation #15 To: Bar of California, State

To ensure that it appropriately reviews complaints involving overdrafts and alleged misappropriations from client trust accounts, by July 2022 the State Bar should, when investigating client trust account-related cases and bank reportable actions not closed de minimis, require its staff to obtain both the bank statements and the attorney's contemporaneous reconciliations of the client trust account, and determine if the relevant transactions are appropriate.

1-Year Agency Response

The pilot project was extended to ensure that a sufficient number of cases are handled to provide meaningful data. As a result, the pilot project remains ongoing. Data collection and evaluation is expected to be completed in April 2023, following which, based on the results of the pilot project, we will make any revisions to policies and practices for investigating client trust account-related cases and bank reportable actions not closed de minimis.

California State Auditor's Assessment of 1-Year Status: Pending

We look forward to reviewing the results of this pilot project upon its completion. However, because of the delay in completing this project, the State Bar should consider whether improvements to its existing process for investigating cases not closed as de minimis are warranted in the meantime. Nothing prevents the State Bar from performing a more thorough review of the allegations that it does investigate. Such a review could include obtaining bank statements and the attorney's contemporaneous reconciliations of the client trust account, as we recommended.

6-Month Agency Response

A pilot project for partial implementation of this recommendation was initiated effective August 1, 2022. See supporting documents - CTA/Bank RA Pilot Program Protocol; Pilot Program Protocols.

California State Auditor's Assessment of 6-Month Status: Partially Implemented

The State Bar has begun a pilot program to more thoroughly review a sample of client trust account cases, regardless of the violation amounts, and will seek bank records for each case. After the conclusion of the pilot program, it plans to assess the costs and benefits of the program and determine how it will revise its practices based on what it has learned. We look forward to reviewing the results of this pilot program after it concludes.

60-Day Agency Response

Following a June 2, 2022, discussion with the State Auditor regarding resource needs for full implementation of this recommendation, the State Bar is developing a pilot project for partial implementation that will provide data for better assessing resource needs. The pilot project will be developed by July 2022.

California State Auditor's Assessment of 60-Day Status: Pending

Recommendation #16 To: Bar of California, State

To ensure that it appropriately reviews complaints involving overdrafts and alleged misappropriations from client trust accounts the State Bar should, by July 2022, require a letter with client trust account resources be sent to the attorney after the closure of every bank reportable action.

1-Year Agency Response

After a check showed that some bank reportable actions had been closed without the required resource letter, a reminder of the requirement for the use of resource letters was circulated on November 23, 2022. Thereafter, we completed the development of revised macros for closing letters that include a question regarding case type that automatically includes required resource language for bank reportable actions. Screen shots demonstrating the operation of the revised macro are provided. On December 21, 2022, an email was sent to OCTC staff regarding use of the revised closing letter macros.

California State Auditor's Assessment of 1-Year Status: Fully Implemented

We obtained a list of all cases closed during a given period and requested a copy of the resource letter sent to the attorney for a selection of those cases. In each instance, the State Bar sent the resource letter or provided us with reasonable rationale for why a resource letter was not appropriate. Thus, we assess this recommendation to be fully implemented.

6-Month Agency Response

All closing letters have been revised to include client trust account resources and these revised closing letters are being used for all closures of bank reportable actions. See supporting document ("Email CTA-Related Complaints") which is a reminder email sent to staff with the list of client trust account resources.

California State Auditor's Assessment of 6-Month Status: Partially Implemented

We have requested a sample of actual letters sent to attorneys and will evaluate the State Bar's response upon receipt of that evidence.

60-Day Agency Response

All closing letters have been revised to include client trust account resources. OCTC is now reviewing its procedures to ensure these revised closing letters are used for all closures of bank reportable actions.

California State Auditor's Assessment of 60-Day Status: Pending

All Recommendations in 2022-030

Agency responses received are posted verbatim.