NJ Office of Attorney Ethics Annual Report: More Investigations, Less Discipline in 2023

The New Jersey Office of Attorney Ethics recently released its 2023 annual report following a year that included restructuring to resolve disciplinary matters quickly, which may have resulted in more overall investigations, but fewer attorneys disciplined.

The annual State of the Attorney Disciplinary System Report, issued Monday, pointed to policymaking and reorganization as two drivers of change for the 40th anniversary of the OAE. The new structure added more staff, which allowed for more timely resolutions of attorney disciplinary matters.

In a letter to Chief Justice Stuart Rabner and the associate justices of the New Jersey Supreme Court, OAE Director Johanna Barba Jones addressed the changes over the past year.

“Our anniversary year was eventful,” Barba Jones said. “With the support and analytical input of the clerk of the Supreme Court and the administrative director of the courts, this court approved a beneficial restructure of our office in August of 2023. That reorganization added attorneys and District Ethics Committee Unit staff with the aim of more regularly satisfying the Rule 1:20-8 time goals for attorney disciplinary matters.”

Last year, 102 attorneys were disciplined, down from a total of 139 attorneys sanctioned in 2022.

In 2023, money offenses other than knowing misappropriation, including reckless misappropriation and serious trust account recordkeeping deficiencies, remained the most common grounds for final discipline. Attorneys acting with dishonesty or misrepresentation and a lack of communication also topped the list for disciplinary consequences, the report said.

Investigations over the past year were up 11.3%, to 919 in total, compared with 815 investigations in 2022. Even with more investigations, new formal charges decreased by 10.7% for the year, with a total of 151 claims compared with 169 in 2022.

The Random Audit Compliance Program, or RAP, conducted 769 audits in 2023, 16 more than in 2022. As a result of the most recent audits, 12 attorneys were disciplined, three of whom were disbarred. Comparatively, there were 753 law firms audited in 2022, more than a 35% increase from 2021 when 487 random audits were conducted.

The RAP has operated for 42 years and detected serious financial misconduct by 270 attorneys. Of those, 115 attorneys have been disbarred.

The report noted that New Jersey is the state with the largest lawyer population to conduct a random audit program. Only eight other states conduct similar programs: Connecticut, Delaware, Iowa, Kansas, New Hampshire, North Carolina, Vermont and Washington. The program is administered by the OAE and managed by Chief Auditor Joseph Strieffler.

The report highlighted a program using a Microsoft algorithm for randomness that selects law firms for random audits. According to the report, the program uses telephone numbers to select the firms.

“Over 40 years after RAP first began, the conclusion is that the overwhelming majority of private New Jersey law firms (98.5%) account for their clients’ funds honestly and without incident,” the report said. “Although technical accounting deficiencies are regularly found and corrected, the fact is that only 1.5% of the audits conducted over that period have found serious ethics violations, such as misappropriation of clients’ trust funds.”

As for the timeliness of investigations, the report noted that the New Jersey Supreme Court established goals for the “thorough and fair” completion of disciplinary investigations and hearings. The rule, 1:20-8, says that the disciplinary system will endeavor to complete complex investigations within nine months and standard investigations within six months.

The 2023 report said that the OAE’s average time goal compliance for the year was 65%, an 8% improvement from 2022.

The report acknowledged the Supreme Court’s Committee on the Duration of Disbarment for Knowing Misappropriation’s recommendation that the court afford disbarred attorneys a path back from disbarment. Still, language concerning the permanency of disbarment remained in all New Jersey orders last year.

Since the court’s 1979 decision in In re Wilson and Rule 1:20-15A(a)(1), disbarment in New Jersey “has been, for all practical purposes, permanent.” New Jersey, along with Indiana, Ohio, Oregon, and Tennessee, generally impose disbarment on a permanent basis, while other states, such as Arizona, Alabama, California, Connecticut, Florida, Kansas, Louisiana and Mississippi, have recognized the importance of permanent disbarment in some, but not all, cases, the report said.

Barba Jones also noted that in 2023, the Supreme Court Committee on Wellness in the Law was founded, which raised awareness and tried to diminish the stigma of attorneys seeking mental health help. In December, the court amended two rules to allow third-party referrals to the New Jersey Lawyers Assistance Program.