The following are case studies of claims notified under the Malaysian Bar PII Scheme.  All names of people and places have been replaced to maintain anonymity.

The firm of Howie Mandell & Co was alerted when they received a call from their bank stating that a Client of theirs was trying to cash cheque from a defunct account of their now-closed branch.  When the lawyers of Howie Mandell & Co questioned their Client on where he obtained the cheque from, the Client told them that Tom, the office manager of Howie Mandell, had passed it to him in lieu of payments due to him. 
 
Fearing the worst, the partners of Howie Mandell & Co proceeded to check through all their files to which they concluded that Tom had been misappropriating funds over the course of six years. 
 
When questioned on their financial habits, the Partners of Howie Mandell & Co conceded that they had placed a lot of trust in Tom to the extent of leaving the financial affairs to him, including leaving the cheque books in his care.  When questioned, Tom conceded that he did steal the money from the firm's Office and Client Accounts to finance some personal debts that he had. 
 
 

Lara was a conveyancing clerk in Donald, Mickey & Co.  On a day that Lara was on leave, Donald (the partner in charge of the Firm’s conveyancing practice) received an enquiry from a Client on the status of his purchase of a residential property.  The Client informed Donald that he had already paid the requisite fees. 
 
When Donald studied the Client’s file he realised that the Client had actually paid the money and Lara had issued the Client with a receipt for the same BUT only recorded a minimal amount received into the Client’s file. 
 
Donald then perused another file that Lara was in charge of.  The Client of that file had also called on the same day, wondering why a refund he was due was still not forthcoming.  When Donald checked the Refund Register he noticed that refunds had allegedly been made to the Client’s son.  The Client’s son denied receiving the money.  Lara had in fact, been taking cash received from Clients and deceived the Partners into signing cheques which was traced to her. 
 
 

Total amount embezzled: RM110,000

Warner of Warner & Co realised something amiss when his clerk, Sue, was on leave and he received a call from a Client, Oscar, enquiring about his purchase of a property which seemed to have stalled.  Warner promised to revert to Oscar after he studies the file. 
 
In the file, Warner found cheques made out to a third party with the description of “Renovation Costs” penned into the ledger with copies of cheques made out to third parties, but not to the vendor.  This transaction was supported by a Letter of Authorisation purportedly signed by Oscar.  Warner recalls having relied on the Letter of Authorisation to sign the cheques prepared by Sue to release the monies. 
 
Warner called Oscar to enquire if he had in fact, issued instructions to transfer the money to a third party.  Oscar stated that he had at no time, released any authority to do so.  Further investigation revealed that Sue had forged the Letter of Authorisation with Oscar’s signature. 
 
It was later ascertained that ten of Warner & Co's other files were tampered with in the same manner by Sue. 
 
 

Total amount embezzled: RM300,000

The conveyancing partner of Peter Pan & Co, Mr Hook, requested his staff to prepare payment for a Client from the Client Account.  The clerk, Lila, was unable to do so because she was aware that there were insufficient funds in the account.  It was then that Lila came clean and confessed that she had taken funds out of the Client’s Account and paid it into her own account. 
 
The Firm signed legitimate cheques for the transfer of monies from its Client's Account to its Office Accounts.  But instead of making the cheques out to the Office Account, they entrusted Lila with cash cheques, believing that she will be trustworthy to transfer the requisite amounts into the Office Accounts.  Instead, Lila encashed the cheques and kept the money for herself. 
 
The Firm gathered formal confessions from Lila stating that she had misappropriated vast amounts of money over the course of three years.  Most of the cheques were encashed by her husband.  Both Lila and her husband were prosecuted and jailed. 
 
 

Total amount embezzled: RM40,000

Mr Kent is sole proprietor of Clark Kent & Co, operating his law firm in Kuala Lumpur.  Mr Kent employed only one other person - Ms Lois, who managed the office’s day-to-day activities and handled the financial affairs of the firm - including the upkeep of the Office and Client Accounts. 
 
Mr Kent grew suspicious that something was amiss when bank reconciliations were not prepared by Ms Lois in a timely manner.  She had worked with him for over ten years and she was always reliable.  Her excuse for not preparing the reconciliation was the bank had not supplied any of their accounts’ statements. 
 
Conducting his own checks, Mr Kent noticed some funds were missing from his Client’s Account.  Upon conducting further investigations, he came to the realisation that Ms Lois had been stealing cheque leaves and forging his signature. 
 
In a bid to secure better evidence and a paper trail, Mr Kent requested for scanned images of all cheques that were cashed from his Bank account.  It showed that she had been making payments to third party collaborators as well as into her own account, using the Firm's cheques and forging his signature.
 
 

Total amount embezzled: RM700,000

Corrine was the secretary cum conveyancing clerk of Wayne & Associates.  Corrine was deemed a model employee by Wayne, who entrusted her with the firms account's as well.  Corrine often stayed late at the office on the pretext of completing her work.  She also rarely took leave days.  Due to her seniority, other staff did not question her or raise the issue with any of the Firm's lawyers when she instructed them to not deal with her files without her prior permission. 
 
Corrine was in fact forging payment vouchers by creating fictitious "payees" on the vouchers.  Whenever there was any shortfall, Corrine would resort to transferring funds between accounts to make up for it.  Her actions went undetected for three years. 
 
The embezzlement was only brought to light when Wayne uncovered discrepancies when he personally attended to a redemption for a client's charged property.  Further investigations revealed that Corrine's husband was a compulsive gambler. 
 
 
However well-versed your accountants and accounts staff are, the responsibility ultimately lies with the partners who are accountable.  If you allow your staff too much freedom with no separation of duties and supervision, it is safe to say that temptation may lead to theft.  Adopt a proactive approach!  See 20 Tips to Avoid Embezzlement for important tips on how to safeguard your firm's accounts.