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A year of living dangerously

By Howard B. Miller
President, State Bar of California

Howard B. Miller
Miller

The State Bar faces critical challenges in the year ahead.

YOUR MONEY The first obligation of the State Bar Board of Governors is to make sure your money is handled responsibly, efficiently and effectively. A little over one year ago, the Board of Governors was shaken to its core when we learned that a single staff person had, over a period of eight years, embezzled from the State Bar what was ultimately determined to be $675,000. The employee, who was in charge of both leasing and collecting rental receipts from the commercial tenants at the headquarters building the State Bar owns at 180 Howard St. in San Francisco, is being criminally prosecuted.

The Board authorized a special outside audit of the embezzlement and internal controls. The audit showed there was a need to work for significant improvement in all the State Bar’s internal and management controls. (That audit is posted on the State Bar Web site, along with other relevant documents. Go to calbar.ca.gov, in the left column click Board of Governors>Meeting Agendas>Board of Governors Meeting Archives>Sept. 12, 2009, Board of Governors Meeting; then click on 181 Audit Committee 2009-2010 Goals and Objectives. The link to three relevant documents will come up. Attachment A is the audit, identified on its first page as a risk scan.)

The work will be done through the Board’s Audit Committee, chaired by Laura Chick, a public Board member who served for eight years as Controller of the City of Los Angeles and is now the Inspector General of the State of California, responsible for auditing expenditures of federal stimulus money. The Audit Committee and Board are now examining in great detail all the financial and management functions of staff and developing new metrics and reporting functions.

RECRUITMENT We currently are recruiting to fill vacancies in two of our most important staff positions: Chief Trial Counsel and General Counsel.

The Chief Trial Counsel is in charge of our disciplinary arm, the Office of Chief Trial Counsel (OCTC). The Board is grateful for the recent review and report from the California State Auditor that identified areas where the management of the Office of Chief Trial Counsel could be improved. We want an Office of Chief Trial Counsel that is not only fair and effective, but also efficient. One of the major skills we are looking for in a new Chief Trial Counsel is demonstrated management experience in a prosecutorial setting.

In our search for a General Counsel, the prime adviser to the State Bar, we are looking for someone who not only is an outstanding lawyer with experience as a general counsel but who has demonstrated an understanding that the client is the institution and will have the independence to directly advise the Board on critical issues.

LOAN MODIFICATION FRAUD Many months ago, we began getting 800-900 calls a month to our complaint hotline from individuals with the same story: They had faced loan foreclosure on their home and had seen a television advertisement from a lawyer promising that for an advance fee of between $2,500 and $3,500, the lawyer could solve the problem. They paid the money. The lawyer either did nothing or disappeared. The money disappeared. Based on the work of our OCTC, we now believe there are at least hundreds, and perhaps thousands, of California lawyers who reached out to victimize those who already were victims at the most vulnerable point in their lives. Every one of those lawyers will be subject to discipline. Some will go to jail.

LEGAL SERVICES AND PRO BONO We must do more than simply discipline and prosecute those lawyers who have taken advantage of their clients in loan modification scams. As a profession, we have to step up to the plate and help those clients. We are organizing legal service and pro bono providers to make available a pro bono counsel to clients who have been victimized by lawyers in loan modification fraud. We cannot sweep this under the rug. As a profession we must take responsibility and act, and make clear that a core value of the profession is providing representation to clients in need. We already have taken significant steps to promote that core value by simplifying some conflict of interest rules, promoting limited scope representation, supporting self help centers and reorganizing the Board of Governors to a greater focus on legal representation and pro bono work. More will follow.

RULES REVISION COMMISSION A State Bar Rules Revision Commission has been working for eight years to revise the California Rules of Professional Conduct. We will finish this year. The meetings of the Commission have been accelerated and additional staff and resources have been provided to help the Commission finish its task by July 2010, so the rules can be sent to the California Supreme Court for their review and adoption. Proposed rules are regularly posted in the public comment area of the State Bar’s Web site. Interested organizations and ethics committees of local and other bar associations are specially invited to comment on the work of the commission. The new rules have the potential to change much in law practice in California. We welcome the comments and participation of each of you in this process.

COMMISSION ON JUDICIAL NOMINEES EVALUATION (JNE) A bedrock of the JNE process is confidentiality. That was shattered recently when the evaluation of a nominee for the District Court of Appeal was leaked to the public before the Governor made the appointment. We reacted forcefully. An investigative committee, with members with substantial law enforcement experience, has been appointed and will have full subpoena powers. If the source of the leak is found to be a member of JNE, that member will be removed from the commission; if that member is a lawyer there will be discipline, and there may also be criminal prosecution. We take this very seriously. We must uphold the standard that when applicants send information to JNE they assume complete confidentiality, and they will suffer no harm if they are not nominated for an appointment.

I will be writing more about all these matters in the months ahead. But as I begin my year as State Bar President, I want to assure you that the Board of Governors understands our responsibilities. We are an integrated bar, an agent of the Supreme Court of California, not just a membership organization, and we require mandatory dues. That informs our sense of responsibility in managing and spending your money. We need to manage with excellence and to represent the highest values of the legal profession, in our interest and in the overriding interest of the public.

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