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They All Had Access to the Trust Account. That Was the Problem. | Stolen From Within
This is episode three of four in the October series, Stolen From Within. All four episodes this month are solo — no guests, just the numbers and the stories law firm owners need to hear before they happen to you.
Today's episode is about your trust account — the IOLTA account that holds client money, not firm money. The account your state bar holds you personally responsible for. And the account that has been the target of fraud by paralegals, attorneys, and partners.
Three cases. Three perpetrators. One common thread: client trust funds accessible to one person, with no one else regularly verifying the money was where it was supposed to be.
Case one: Jennifer Elaine Rourke, a paralegal at a North Carolina law firm who executed 190 unauthorized wire transfers from client trust accounts over six years. Total: more than $2 million. She pleaded guilty to wire fraud and was sentenced to 30 months in federal prison.
Case two: Benjamin Tariri, a Boston attorney who embezzled nearly $2 million from eight clients — many of them fellow Iranian immigrants who trusted him. He was arrested at Logan Airport attempting to board a one-way flight to Iran. He was disbarred, convicted on multiple counts including fiduciary embezzlement and obstruction, and sentenced to three to five years in state prison.
Case three: Patrick Dolan, a Boston lawyer who stole more than $2 million he was holding in escrow, including at least $87,500 from a supplemental needs trust he set up for a client — money he used toward a down payment on his house. He pleaded guilty to wire fraud and was sentenced to 39 months in federal prison.
In this episode, Kelley walks through what happened in each case, why the trust account carries unique risk, and the five specific controls that protect it — starting with the three-way reconciliation you should be doing every single month.
This series is called Stolen From Within, but unofficially it's Scary October. And the inspiration came from a conversation with Delisi Friday — if you're not connected with her on LinkedIn, go find her: https://www.linkedin.com/in/delisifriday/
Next week: the final episode. Warning signs hiding in plain sight — fake vendors, expense manipulation, and what happens when no one is checking the bills.
Stolen From Within — all four episodes:
Episode 1 (Oct 7): She Worked There for Six Years. She Stole $839,000. Nobody Noticed.
Episode 2 (Oct 14): He Signed the Partner's Name 806 Times.
Episode 3 (Oct 21): They All Had Access to the Trust Account. That Was the Problem.
Episode 4 (Oct 28): The Checks Were Right There. Nobody Was Looking.
Sources: DOJ press releases from the U.S. Attorney's Office for the Western District of North Carolina (Rourke); Massachusetts Attorney General's Office (Tariri); DOJ press release from the U.S. Attorney's Office for the District of Massachusetts (Dolan). All facts verified against primary sources.
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