New Albany lawyer agrees to probation, will pay $15K for shoddy accounting

A southern Indiana lawyer who for a decade mismanaged his firm’s trust accounts has agreed to a probationary period of at least three years, staying a nearly six-month suspension, under terms of an attorney discipline agreement approved Wednesday by the Indiana Supreme Court. The attorney also agreed to pay more than $15,000 in costs to the disciplinary commission and court.

New Albany attorney Lloyd E. Koehler will be spared suspension if he agrees to numerous terms of his conditional agreement for discipline unanimously approved by the court.

Koehler “has mismanaged his trust accounts since 2009,” the court said in its order. Among other things, he “overdrafted one trust account by about $38,000, and then replenished about $44,000 (resulting in more than a nominal amount of his own funds being held in trust); he improperly delegated tasks to, and inadequately supervised, a nonlawyer assistant; he did not maintain adequate trust account ledgers or deposit journals; and he improperly commingled client and attorney funds.”

The order did not indicate whether any clients or parties had suffered a financial loss due to Koehler’s mismanagement. Koehler and the disciplinary commission agreed his conduct violated 17 various Indiana Rules of Professional Conduct related to accounting and oversight of nonlegal assistants.

Koehler’s stayed suspension will last at least three years and is subject to monitoring of his firm’s trust accounts by a certified public accountant who will report monthly to the commission. Koehler also must cooperate fully with the commission and report any violations of the terms of his agreement within 14 days. He also must pay the commission $14,404.96 for the cost of its investigative expenses, $250 to the clerk for court costs and $358 to the court for hearing officer expenses.

The case is In the Matter of: Lloyd E. Koehler, 19S-DI-365