Friday, January 2, 2009

Conversion Of Funds Of Incarcerated Beneficiary Warrants Disbarment

An Illinois woman who died left her estate to her grandson, who is serving time for arson and murder with a projected release date in 2031. The estate was administered by an attorney who used a significant portion of the estate assets (approximately $78,000) for his own purposes, claiming that the father of the beneficiary had authorized his use as a series of loans. An Illinois hearing board found that the attorney's testimony in that regard was not credible and has recommended disbarment:

We did not find Respondent to be a credible witness and reject his claim that he took the funds as a loan. His testimony was contradicted by Brian [the beneficiary],who denied authorizing Respondent to use any funds for his own purposes, denied agreeing to loan money to Respondent, and denied knowing that Respondent used or borrowed any of the money. Brian’s letters to Respondent, which we regard as trustworthy, contain no reference to Respondent’s use of the funds. To the contrary, Brian repeatedly expressed his desire that the funds be preserved and invested in a safe vehicle so he would be assured of some financial security upon his release from prison.

Respondent’s reliance on William’s [the father] statements or actions to justify his use of the funds is not well founded. Respondent contended that he and William agreed in November 2002 that Respondent could use the funds and repay the estate within thirty days of demand being made. The purported agreement was not reduced to writing however, and while William attempted at hearing to confirm the agreement, we found his testimony to be confusing and inconsistent. He was not able to pinpoint the specific terms of any loan to Respondent nor did he adequately explain why, when he submitted a written request for investigation of Respondent’s conduct, he made no reference to any type of loan agreement. We find it highly improbable that Respondent would be given free access to a large sum of money without any documentation to support the agreement or terms of repayment.

We further find that even if William did consent to a loan to Respondent in November 2002, he had no authority to do so. Again, nothing in Brian’s testimony or letters to Respondent indicate that Brian had turned over control of his finances to his father at that time. In fact Brian testified that his relationship with his father was "not too hot" and in a February, 2003 letter to Respondent, Brian specifically stated that he did not want his father to handle his affairs.

An aggravating factor was the difficulty of the beneficiary in monitoring the lawyer's actions. The attorney had previously been suspended for two years. (Mike Frisch)

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