This… is not what the American Bar Association needs right now. Amid its monetary woes, layoffs, and mounting lawsuits comes news that it is out ~$1.3 million dollars, taken by a now-former employee. The ABA disclosed the info in a tax document on Friday, where it was revealed the employee siphoned money from the organization from 2010-2017.
Once caught, the employee was promptly fired, and law enforcement was notified, as reported by Law360:
According to the organization’s most recent Form 990, filed with the IRS, a nonmanagerial staff member of the ABA diverted approximately $1.3 million over several years before getting caught in 2017, immediately placed on administrative leave and then fired the next day.
The ABA has notified both law enforcement and the executive committee of its board of directors, the filing said. A law enforcement investigation is “ongoing.”
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The ABA also hired accounting firm Grant Thornton to conduct an internal investigation and made some changes to their internal procedures to catch issues in the future (ideally before they cross into the million-dollar territory):
In addition to the investigation, the ABA said that it “reviewed and revised procedures including more stringent controls and monitoring and increased financial oversight” and is in the process of trying to recover from its insurance company the money that was allegedly taken.
Let’s hope they can recover the money from insurance, as the monetary shortfall certainly isn’t going to be made up in new membership fees.
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Kathryn Rubino is a Senior Editor at Above the Law. AtL tipsters are the best, so please connect with her. Feel free to email her with any tips, questions, or comments and follow her on Twitter (@Kathryn1).