UPDATE We've been digging deep into the issues. We've found a TON of accounting errors that the former senior paralegal made. Among many other errors, on numerous occasions that paralegal mistakenly wrote trust refund checks to the same client multiple times. I feel a lot better about the situation and I am happy with the way the firm is handling things. I won't be reporting this to the BAR. The former paralegal was just an idiot and should never work in another law firm ever again.

I’ve been low key freaking out about this. I became our firm’s senior paralegal in January. The paralegal before me was terrible at the job. Since she left, TONS of her mistakes have appeared, many of which I am still resolving to this day.

On Monday, the managing director asked me to conduct an audit on the the trust account. I did so, and the preliminary results came back a total nightmare. We have $31,000 in our domestic relations trust account. First results say we are supposed to have $90,000 in trust!!!!!! I informed my manager of the massive discrepancy today (Tuesday).

We immediately sat down and began trying to troubleshoot the problem. We spent 8 hours reviewing client electronic files and between the two of us, we were able to resolve about $15,000 of the discrepancy. However that still leaves about $45,000 unaccounted for. I am positive that the $45,000 number will not decrease significantly.

It is obvious that our managing director is taking this very seriously. We talked about bringing in a team of CPA’s to conduct a full audit and got a quote of how much that would cost. Obviously, we need to figure out where that money has gone and more importantly, we need to have a to-the-penny accounting done to figure out how much money needs to be added in. I feel like I always post on this sub with the most outlandish situations. I have questions:

1.) What are my ethical duties to report this to the BAR? Management obviously trying to fix this but I don’t know if that changes anything.

2.) If this is reported to the BAR, what are the consequences? At this point the Managing director and the attorney owner of the firm are both aware of the scope of the problem and are working to fix it, but at this time we have NO IDEA where the money went.

3.) Would it be inappropriate for me to wait to report this to the BAR until after the accountants reviewed everything?

4.) Any other suggestions? Am I too optimistic? Should do I be running away from this firm? I don’t want to be standing in a burning building, waiting for the fire department to show up.