Mahvash Ikram
A former legal secretary who stole more than $1.3 million in client trust funds and used the money to buy herself a house can no longer get a job with any practitioner or incorporated law firm without written consent from the Lawyers and Conveyancers Tribunal.
At a recent tribunal hearing, counsel for the Auckland Legal Standards Committee, Matthew Mortimer-Wang, said the offences – if committed by a lawyer – would have resulted in the practitioner being struck off under s 11 of the Lawyers and Conveyancers Act.
The tribunal heard that the woman, who has name suppression, started working as a secretary for an unnamed law firm in February 2024. Later that year, she signed a sale and purchase agreement for a private residential property.
On 2 December, the woman created a false electronic file within the firm’s system and assigned the file a number associated with an actual client of the firm.
She then told the accounts manager that one of the firm’s legal executives had issued oral instructions that $170,000 needed to be “journaled” from funds held in trust for the client and transferred to pay the deposit on a property purchase.
On 9 December, the woman created a fake hard-copy client statement that showed more than $1.2m held on trust was to be transferred. The funds were eventually used to settle the purchase, with the property registered in the woman’s name.
In February 2025, the firm discovered the theft and at a subsequent disciplinary meeting the employee admitted misappropriating client trust funds.
Long-term consequences
Counsel for the employee, Mark Saunders, asked for leniency on penalty, telling the tribunal that his client had already repaid the funds she had embezzled as well as any legal fees incurred by the insurers and the firm, and the interest that would otherwise have been earned on the funds.
“Every cent that could possibly have been sought in terms of reimbursement has been repaid.”
It was easy to forget that his client would suffer long-term consequences as a result of her offending, Saunders said.
“It is [now] a necessary fact of disclosure in one form or another – when you have employment; it [also] stops you getting insurance on your motor vehicle. It has stopped her effectively getting insurance on her car because it’s an offence of dishonesty… This will go on for a very long time and with respect, I think its impact needs to be weighed in the process.”
However, Saunders acknowledged the offending was serious and his client had admitted fault.
“There’s no doubt that the matter for which [she] appears… is of the utmost gravity. And [she] has readily admitted responsibility… hasn’t sought to blame anybody else… has been open and forthright about it.
“There are aggravating features in terms of breach of trust. The impact on the firm, its employees, staff, client. There was a degree of planning for it to happen. There were two instances, but the second of them automatically followed the first because one was for the deposit and one was for the completion of the purchase.”
Significant wrong
While the respondent’s presence at the tribunal and remorse were mitigating factors, Mortimer-Wang acknowledged they were not enough to outweigh the seriousness of the offence.
“[The respondent] does deserve credit for the steps taken to try to make things right…Not everyone fronts up to the tribunal in these circumstances. But the mitigating factors can’t, when it comes to matters of penalty, counteract the significance wrong committed.”
Mortimer-Wang asked the tribunal to consider the consequences if a lawyer had embezzled funds in a similar manner.
“If the tribunal had a lawyer in front of them, who had taken $1.3m of client money and spent on themselves, would the tribunal have any hesitation in reaching strike-off as an outcome?
‘There is no other outcome that meets public protection and with public confidence goals because anything less than a do-not- employ order would be to say to the public that the profession is okay with letting a person that stole client money keep working in law firms.”
The tribunal made a do-not-employ order except with its written consent, as stipulated under s 242 1(H) (iii) of the Act. She has also been ordered to pay costs.
The tribunal will issue a written decision, including penalty, in due course.
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