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Paralegal Arrested for Robbing Peter to Pay Paul

By May 19, 2009Ethics

Surprise A former paralegal has been arrested for allegedly stealing from one firm to pay another.  The paralegal allegedly stole over $100,000 from the Norristown, PA firm of High Schwartz to repay $285,000 to a New York firm. According to the Legal Intelligencer, the paralegal was found guilty for stealing from that firm, she  was ordered by the court to make restitution.

Are you following this yet?  According to the Montgomery County DA's office, an internal audit, done after paralegal Kathy Foer-Morse was fired by High Swartz for attitude and work performance, revealed the alleged theft.

Kathy Foer-Morse has been arrested for allegedly writing 12 unauthorized checks to herself totaling $100,937.32, which were then deposited into her personal bank account. The press release said Foer-Morse was fired from High Swartz May 1 because of issues with her attitude and work performance.

A subsequent internal audit of the estate accounts she handled at the firm revealed the alleged theft, which was then reported to the Montgomery County district attorney's office and the Montgomery County Detective Bureau.

According to the press release, county detectives discovered Foer-Morse was free on bail and awaiting sentencing in New York City for the theft of $285,000 from Satterlee Stephens Burke & Burke. A search warrant of Foer-Morse's bank accounts revealed that the money she allegedly stole from High Swartz was being used to pay restitution to Satterlee Stephens. Paul Baker Bartle, managing partner of High Swartz, said he let Foer-Morse go on a Friday, and the firm began routine audits of her estate accounts the following week.

It was discovered that a check for almost $60,000 was deposited in Foer-Morse's account using the forged signature of the estate executor. According to Bartle, the discovery of the rest of the stolen money was made shortly thereafter and he immediately notified county authorities.

Bartle said it was soon discovered that the amount of money stolen from his firm "dovetailed exactly" with the payments Foer-Morse was making to Satterlee Stephens. Bartle vowed that all of the missing money would be repaid to his firm's clients.

Bartle said the firm found Foer-Morse through a recruiter but that he blames only himself for ultimately hiring her. "We misjudged this person," he said, but admitted that he did not have all the facts when he hired her.  Bartle said he thinks the firm may end up filing some lawsuits as a result of the ordeal but declined to say who the targets might be. [Our guess is the recruiting agency may get sued, as is typical in these types of cases.]

Bartle said the firm "will make some internal changes" to prevent something like this from happening again. "It might not stop it in the future but it's going to make it a lot tougher to steal money from us," he said, but conceded that "to try to outwit the criminal mind is a difficult practice."

Bartle said Foer-Morse would have been caught eventually anyway when she submitted her accounting summaries for the estates she was handling. The sad thing, he said, was that the firm didn't catch her before she allegedly took the money.

Bartle said that short of asking for a new hire's Social Security number before hiring them, it would be difficult to sniff out a criminal before they struck. "Foer-Morse" was one of several aliases, he said.

On Friday, according to the press release, Magisterial District Judge Margaret Hunsicker arraigned Foer-Morse and set her bail at $99,000 straight bail, with a preliminary hearing currently scheduled for 11 a.m. May 26.

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