Financial Misconduct that Could Lead to Loss of Your Occupational or Professional License

Financial misconduct is a common ground for disciplinary action against the licenses of many professionals. Whether it relates to the mishandling of funds or fraudulent billing, financial misconduct can lead to serious sanctions, including the suspension or revocation of your professional license. Therefore, when you face disciplinary action based on financial misconduct, you owe it to yourself to get immediate legal advice and representation. The professional license defense lawyers of Bertolino, LLP, can help you develop a strong defense to the disciplinary proceedings against you and protect your license.

Fraudulent Charging and Billing for Goods and Services

Professionals who provide goods and services to clients, customers, and patients must follow all laws and rules on charging and billing practices. When they run afoul of those rules, their licensing boards may have grounds to take disciplinary action against them.

For example, 22 Tex. Admin. Code §79.3 lists “Financial Misconduct” as a type of “Unprofessional Conduct” that may lead the Texas Board of Chiropractic Examiners to take disciplinary action against a licensed chiropractor. More specifically, licensees commit financial misconduct if they:

  • Commit fraud in the charging or billing of goods or services;
  • Charge or bill a patient or a third party for goods or services that are excessive; or
  • Submit a claim for goods or services that are not sold or rendered.

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Similarly, under 22 Tex. Admin. Code §190.8(J), doctors engage in unprofessional or dishonorable conduct that is likely to deceive, defraud, or injure the public when they provide “medically unnecessary services to a patient or submit[ting] a billing statement to a patient or third party payer that the licensee knew or should have known was improper. “Improper” means the billing statement is false, fraudulent, misrepresents services provided, or otherwise does not meet professional standards.” This type of financial misconduct is a basis for disciplinary action against doctors.

Some doctors and health care professionals also face federal criminal charges related to Medicaid and Medicare fraud for allegedly fraudulent or improper billing practices. Even in the absence of a conviction, these criminal charges can give rise to disciplinary charges under 22 Tex. Admin. Code §190.8(R). This section of the code states that doctors can be subject to discipline for committing any felony under state or federal law or any criminal violation of the Medical Practices Act or other statutes regulating or concerning the practice of medicine. Disciplinary action is possible regardless of whether there is a complaint, indictment, or conviction arising from the criminal acts.

Trust Accounts: Handling Clients’ Money

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Some professions require you to handle clients’ money for various reasons. For example, real estate brokers often receive money from clients as earnest money, rent, unearned fees, security deposits, or other money related to real estate transactions. Brokers must follow strict rules for maintaining hold money on behalf of clients in trust accounts according to Texas Real Estate Commission Rules §535.146. Most importantly, brokers hold these deposits in a fiduciary capacity, so they must not commingle these funds with personal funds or non-trust money, deposit them in a personal or business account, or use them to pay operating costs. Violating these rules can lead to disciplinary action.

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Attorneys also must follow rules of professional conduct concerning money held in trust for their clients. For example, under Rule 1.14 of the Texas Disciplinary Rules of Professional Conduct, lawyers must hold funds belonging to clients or third parties in separate “trust” or “escrow” accounts separate from their funds and accounts. In addition, lawyers must keep detailed records of these accounts and funds for five years after the termination of their representation of the client. Violation of these rules of professional conduct also can result in disciplinary action against the lawyer by the State Bar of Texas.

Misappropriation of Funds

Misappropriation of funds or property or other similar criminal offenses can be a basis for disciplinary action against some professional licenses. Educators, including teachers, principals, and superintendents, can lose their licenses and teaching certifications under 19 Tex. Admin. Code §249.15(b)(10)(D) if they commit any offenses involving school property or funds. These offenses are grounds for discipline, whether there are criminal convictions related to the offenses.

Financial Statements and Tax Returns

Certified public accountants (CPAs) must comply with some specific rules concerning preparing financial statements and income tax returns, as those tasks are integral to their profession. Under Tex. Occ. Code §901.502(2), a CPA can face disciplinary action for fraud, dishonesty, or gross negligence in the performance of services as a license holder, including: (A) knowingly participating in the preparation of a false or misleading financial statement or tax return; or (B) failing to file the license holder’s income tax return.

Count on Bertolino LLP to Defend Your License from Disciplinary Action

When a complaint threatens your ability to earn a living, you need a seasoned license defense attorney on your side. We will defend you against these attacks on the credentials you have worked so hard to earn. Get in touch with the lawyers of Bertolino LLP, today by calling (512) 476-5757 or visiting us online.

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