Federal authorities are accusing the accounting firm for Donahue Securities Inc. of being negligent in its annual audits, allowing the brokerage's president to pocket more than $6 million in client money.

        That negligence accusation is the basis of a lawsuit filed Wednesday against Munninghoff Lange & Co., a Covington-based certified public accountant firm. Government trustees are seeking a judgment of more than $6 million against the firm and its senior auditor, partner Douglas B. Lange.

        Mr. Lange did not return a telephone message left Wednesday.

        His partner, Thomas J. Munninghoff, said the firm became aware of a possible lawsuit within the last two months. The accountants audited Donahue Securities' books annually from 1991 to 2000.

        “We felt we did everything correctly and have no liability on our part,” Mr. Munninghoff said.

        Their one-time client Stephen G. Donahue is expected to plead guilty Monday to a federal criminal charge accusing him of operating a bogus tax-free bond fund. Authorities say that instead of depositing client funds in such a fund, he spent the money on his businesses and himself.

        Federal investigators shut down Donahue Securities and its sister financial planning firm, S.G. Donahue & Co., in March 2001 after uncovering the bogus fund that affected about 123 investors.

        Court-appointed attorneys have sold off much of Mr. Donahue's property and investments in the last year. Trustees with the Securities Investor Protection Corp. have since repaid about $4.5 million to investors and are in the process of returning another $488,000.

        The suit does not claim that auditors at Munninghoff Lange had knowledge of the illegal scheme — only that if it had properly conducted its audits, it would have discovered it and protected investors.

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