Audit Blasts Practices|of California State Bar

SACRAMENTO (CN) - The State Bar of California rushed disciplinary cases to shorten its backlog, was soft on offending attorneys and spent $50 million over-budget for a building renovation, according to a scathing report by the state auditor.

The 69-page report released Thursday by the California State Auditor, the second audit of the organization since 2009, also blasts the State Bar for being understaffed despite having a surplus from member fees over its operating budget.

In 2010 the State Bar's backlog reached over 5,000 cases and in response its executive director issued a zero-backlog goal in order to clean up the amount of disciplinary cases more than six months old. While the backlog decreased 66 percent by 2011, the audit says the state organization focused on small offenses and insufficiently doled out punishment.

"By prioritizing reduction of the backlog, the State Bar may have put the public at risk because it settled more cases for less severe levels of discipline than it otherwise might have," the audit reads.

Following the State Bar's rush to clear its backlog, the state Supreme Court returned 27 settlements back to the State Bar for insufficient levels of discipline - 21 attorneys were issued more severe punishments, including five disbarments.

The audit found that during 2011 the State Bar, eager to clear disciplinary cases, allowed employees to settle cases with attorneys without review by management or supervisors. Due to poor oversight and workforce planning, the audit says the backlog has increased 25 percent since 2011.

The report also details the State Bar's 2012 purchase and renovation of a building in Los Angeles which carried a $76.6 million price tag, but was only approved for $10 million by the state Legislature. The audit found the State Bar broke state law by failing to inform the Legislature of its final decision to purchase the building and that it grossly underestimated the cost of the project.

"The State Bar of California's primary mission is the protection of the public through its attorney discipline system," the audit says. "However, the State Bar's financial priorities over the past six years did not consistently reflect that mission: Rather than using its financial resources to improve its attorney discipline system, the State Bar dedicated a significant portion of its funds to purchase and renovate a building in Los Angeles in 2012."

The State Bar agreed that the 2012 purchase suffered from a lack of transparency.

"The LA building is a great acquisition for the agency, its employees and State Bar members," Acting Executive Director Robert Hawley said in a statement. "What we have learned from the audit about the lack of transparency as the deal progressed, is another issue. That is being addressed."

Thursday's report says the State Bar quickly reverted back to old form following the initial 2009 audit. The State Bar initially implemented an improved method to calculate and report the cases in its backlog per the auditor's recommendation, but since 2011 it has failed to meet state law requirements and reports too few cases.

The auditor recommends that the State Bar and Legislature work together to communicate which cases take priority, such as cases affecting public protection, and that it implement a more rigorous cost-analysis program for large purchases. It also calls on lawmakers to force the State Bar to submit biennial finance and spending reports as opposed to annually.

In response to the audit, the State Bar said it is hiring a new executive director and that it "generally" agrees with the recommendations and that it has implemented several changes since 2012 to improve backlog efficiency and reporting.

"The audit report identifies several areas for the State Bar to focus upon in advancing the discipline system: staffing levels, work force planning, internal audits, quality control, and continuing to improve our reporting methodologies and capabilities, all of which have been works in progress during my tenure," said Jayne Kim, chief trial counsel, in a statement.

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