A Pennsylvania lawyer who gave a trusted employee another chance
after she stole from his aunt’s estate has been suspended from practice
following her continued client thefts.
The Pennsylvania Supreme Court suspended Harrisburg, Pennsylvania,
lawyer William Krzton for six months for failing to supervise the
employee, who stole additional money from seven estates represented by
the lawyer.
The Legal Profession Blog links to the Aug. 6 order and report, while Law360 has coverage.
Krzton had testified that he was surprised to learn of the additional
thefts. He said he put a lot of trust in the employee, Joy Hale, and he
thought that she was the “perfect” secretary.
According to a report and findings of fact by the disciplinary board
of the Pennsylvania Supreme Court, Krzton hired Hale in 2008 to handle
estate accounting and perform other duties.
Krzton learned in 2013 that Hale had stolen $3,300 from his aunt’s
estate by writing a check and forging his signature. Since $3,300 was
the amount of his fee, he figured that he was the only one who lost
money. He admonished Hale, required her to repay the estate through a
reduction in pay, and gave her a second chance.
Hale continued to steal money from estates. In May 2016, an estate
executrix who hired Krzton to represent her informed the lawyer that
Hale was misrepresenting account balances.
Krzton told the executrix that she must be mistaken. The executrix
persevered, meeting with the bank and taking her allegations to a
detective with the Allegheny County district attorney’s office. Krzton
learned about the investigation July 1, 2016.
The amount stolen from that estate was more than $96,000. Between
July 1 and Sept. 4, 2016, Krzton learned that Hale had stolen from six
other estates, as well, for a total of about $191,000.
Despite Krzton’s knowledge of the investigation July 1, 2016, he
continued to employ Hale for two more months. He testified that he kept
Hale on because he was “not literate” on her computer, and he had to
handle several pressing client matters. Hale did not have access to
estate files and checkbooks during that time, he said.
Hale pleaded guilty to criminal charges of theft and forgery,
according to the findings of fact. She was sentenced to nine months to
18 months in prison and ordered to pay restitution of more than
$202,000. She eventually made payments toward restitution of $12.50 per
month. Krzton settled a suit filed by the executrix for $92,500.
Krzton’s friends testified that he is a trusting person with a good
reputation for integrity, honesty, professionalism and courtesy.
The Pennsylvania disciplinary board said Krzton violated ethics rules
requiring lawyers to act with reasonable diligence, to keep clients
reasonably informed, to keep accurate accounting records, and to
supervise nonlawyers to ensure that their conduct is compatible with a
lawyer’s professional obligations.
“Inexplicably, despite his knowledge of Ms. Hale’s dishonest conduct,
[Krzton] made no efforts to enhance supervision of her activities to
ensure compliance with record-keeping responsibilities and prevent
further thefts,” the Pennsylvania disciplinary board said. Krzton’s
“dereliction of his ethical duties had very serious consequences, as Ms.
Hale’s unfettered access allowed her to steal $191,026.99 from seven
other estates.”
The board also found that Krzton was dilatory in handling another matter, causing a 13-year delay in resolving the estate.
Krzton was admitted to law practice in Pennsylvania in 1976. The
board considered his lengthy career with no prior discipline to be a
mitigating factor. He also had a good reputation and cooperated in the
investigation. And he has made some reimbursement to the estates, either
directly or through his insurance carrier, the board said.
Krzton told the ABA Journal that he has retired from law practice and
works as a consultant to his wife’s company. He enjoyed law practice
for 45 years, and he was “absolutely” sorry to see it end on this note.
It was “a very sad and difficult situation,” he says.
Hale was stealing “in a very nefarious way,” using a color printer at
her home to print fudged bank statements that looked like the real
thing, he says.
Krzton worked as a sole practitioner in a general practice firm
founded by his father in the 1950s. He did a lot of criminal and family
law work that required him to be in court, and he needed someone to
trust in the office.
“You can’t just close the door” when you are in court, he says.
Even his former clients were surprised to learn about Krzton’s wrongdoing, he says.
He thinks the disciplinary board was most upset with the fact that he
kept Hale as an employee for two months after learning that she was
under investigation. He says he “didn’t let her near” estate work during
that time. But he wanted to keep her on, so she could clear everything
off her desk for clients.
Hale had all the institutional knowledge and knew where everything was on the computer, he says.
Krzton says he or his insurance company has settled with every estate, except for one case that is outstanding.
“It’s a cautionary tale, I’m sure,” he says.
