Wednesday, January 11, 2006

Florida Bar Audit Confirms The Law Offices of Eddie Farah Overcharged Clients By $130,000 But No Attorneys to Be Disciplined

JACKSONVILLE, FLA---In early Jan. 2006, I again followed up on my public records request and finally received The Florida Bar's 4/13/05 Audit Report for Eddie E. Farah of The Law Offices of Eddie Farah. According to the firm's web site, it is now known as the Law Offices of Farah & Farah, P.A. The principals in the firm are Eddie Farah and his brother, Charlie E. Farah.

Certified Public Accountant and Certified Fraud Examiner James F. Wells prepared the report following his audit on Farah's trust account records and procedures for the period 2002 through 2004 to determine whether they complied with the requirements of the Florida Bar rules governing trust accounts. Wells' Audit Report noted,

"Administrative costs that were not substantiated by documentary evidence were charged on some settlement statements in personal injury cases. These administrative costs were in excess of the documented costs such as copies, faxes and postage. Rule 5-1.2(b)(4) requires documentary support for all disbursements from the trust account. These costs were not authorized by the clients."

In discussing corrective action taken, Wells stated,

"The firm reviewed client files and settlement statements to determine the specific clients that had been charged unsubstantiated administrative costs. Refunds totaling approximately $130,000, including interest, were issued to those clients."

Wells' Audit Report concluded,

"In my opinion, Mr. Farah's trust accounting records and procedures in connection with the documentation of costs paid from trust funds during the period from January 1, 2002 through December 31, 2004 were not in substantial compiance with The Florida Bar's rules governing trust accounts." (Emphasis supplied).

The records produced by The Florida Bar offer no clues to the basis for its grievance committee's finding of no probable cause for disciplinary proceedings. Cronyism seems to be the likely explanation.

Copyright © 2006 by Jeffrey R. Hill. All rights reserved.

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