Also known as: knowingly misappropriate · knowingly misappropriated · knowingly misappropriating · misappropriation
Written by attorneys · grounded in primary & secondary sources — see below
A form of ethical misconduct by which a lawyer takes client funds entrusted to the lawyer, knowing they belong to the client and without authorization. The violation occurs regardless of any intent merely to borrow the funds, the absence of client loss, or the lawyer's prior record.
Lawyer Jones withdraws $50,000 from the client trust account to pay personal expenses. Jones knows the money belongs to clients and has not been authorized for personal use. The conduct constitutes knowing misappropriation even though Jones intends to repay the funds after an expected settlement.
Attorney Smith repeatedly transfers client funds from the trust account to cover office overhead. Smith knows the money is not hers and the clients have given no permission. Knowing misappropriation is established regardless of Smith's clean record and the clients' lack of financial loss.
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A lawyer issues repeated checks from the client trust account to cover personal fees in pending matters and replaces the amounts only after closings occur. The lawyer knows the funds belong to clients and are unauthorized for personal use. The conduct constitutes knowing misappropriation warranting disbarment to protect public confidence in the profession.
The lawyer must know the money belongs to the client and know the client has not authorized the taking. A subjective intent to borrow rather than permanently convert does not excuse the violation.
No. Neither factor excuses the violation. Disbarment follows to protect public confidence in the legal profession even when clients suffer no loss and the lawyer has an exemplary record.
Yes. The duty to report serious misconduct under rules such as Model Rule 8.3 applies even when the information comes from a client who requests confidentiality and even when a private restitution agreement exists.