May 21, 2009
Corporate CEO Not A Vulnerable Client
A very interesting bar discipline case from Florida has resulted in the Supreme Court's rejection of the referee's proposed admonishment in favor of a suspension of 91 days. The attorney was charged with misconduct in two counts involving the same client, the CEO of publicly traded corporations who had defrauded investors of over $20 million and ended up with a 20 year prison term.The attorney represented the client in an SEC investigation but not in connection with criminal charges. When criminal charges were imminent, the attorney agreed to succeed the client corporate CEO and thereafter had acted in his self-interest and represented conflicting interests.
The court sustained findings of misconduct involving serious conflicts of interest in the lawyer's assuming corporate authority after the client was locked up. The court also sustained the finding that the attorney had not breached the duty of confidentiality. He had testified on the client's behalf at a bond hearing that the client was not a flight risk. He then wrote a letter to the prosecutor to advise that he had believed the testimony when given but later had reason to change his mind. He testified at the bar proceedings that he thought the client would flee when he saw the "look in his eyes." The referee found that the letter did not disclose confidential information.
The court discusses the various aggravating and mitigating factors that drive the determination of the appropriate sanction. The court rejected the bar's contention that the client was "vulnerable" because he was locked up. Rather, the client was a sophisticated con man.However, the fact that other sanctions had been visited on the attorney was not a legitimate mitigating factor. The bar had asked for a suspension of at least 60 days. (Mike Frisch)
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