Finding Text
Criteria: Legal Services Corporation (LSC) grant recipients are required to compile with the retainer agreements requirements of 45 C.F.R. § 1611.9 (b). (a) When a recipient provides extended service to a client, the recipient shall execute a written retainer agreement with the client. The retainer agreement shall be executed when representation commences or as soon thereafter as is practicable. Such retainer agreement must be in a form consistent with the applicable rules of professional responsibility and prevailing practices in the recipient's service area and shall include, at a minimum, a statement identifying the legal problem for which representation is sought, and the nature of the legal services to be provided. (b) No written retainer agreement is required for advice and counsel or brief service provided by the recipient to the client or for legal services provided to the client by a private attorney pursuant to 45 CFR part 1614. (c) The recipient shall maintain copies of all retainer agreements generated in accordance with this section.
Condition/Context: The Organization was unable to provide a copy of the retainer agreement for one case of 60 cases included in the sample. The sample was not a statistically valid sample.
Cause: The Organization did not properly retain the client's retainer agreement due to a one-time failure in document preservation.
Effect: LSC funds could be utilized for unallowable activities.
Questioned Costs: N/A
Recommendation: It is recommended that the Organization ensure proper retention of retainer agreements to align with the regulatory guidance.
Views of Responsible Officials: Management agrees with the auditor’s findings. The Director of Litigation (Lisa Hollingsworth) will have the Regional Leaders remind their staff about the necessity of obtaining retainer agreements from clients in extended service cases.