Thursday, July 28, 2011

Neither The Marriage Or the License Could Be Saved

An attorney who engaged in a pattern of deception was suspended for three years by the New York Appellate Division for the First Judicial Department.

The court described the circumstances:

In the spring of 2001, respondent and his wife jointly purchased a house in Pawling, New York. While they intended to use it as a summer home, they later decided to use it as their full time residence, which required substantial renovations. Respondent's wife demanded that the funds for the renovations come solely from respondent's earnings and refused to join respondent in applying for a line-of-credit loan.

In 2001, respondent applied for and later received a line-of-credit mortgage in his and his wife's name from Citibank for $100,000 ("the Citibank mortgage"). Respondent signed his wife's name to the loan application, misrepresenting to the bank that he was her attorney-in-fact by indicating next to her name that he had power-of-attorney (PA). Respondent's wife had not signed a PA form, nor had she authorized respondent to place her signature on the application or mortgage. The fraudulent mortgage was recorded with the Dutchess County Clerk's Office.

In 2003, respondent obtained a second mortgage in his and his wife's name from Charter One Bank in the amount of $366,000 ("the first Charter One Mortgage"). Respondent forged his wife's signature on a PA form without her permission, misappropriated the notary stamp of a partner (Stanley C. Rucheman), and falsely notarized the PA by forging his partner's name without his knowledge or permission. Respondent then caused the PA form to be recorded with the Dutchess County Clerk's Office.

Respondent subsequently executed a sworn affidavit falsely swearing that his wife had appointed him as attorney-in-fact, and that the forged PA was in "full force and effect." He used this forged PA to obtain the first Charter One mortgage and signed his wife's name to both the mortgage application and the mortgage. The first Charter One mortgage was filed in the Dutchess County Clerk's office. Respondent used the proceeds to fully satisfy the Citibank mortgage. In connection thereof, he sent a cover letter to Citibank in which he signed his wife's name and falsely indicated that he was her attorney-in-fact.

In 2004, respondent obtained another mortgage from Charter One in the form of a line of credit for $167,000 (the "second Charter One mortgage"). Respondent signed and initialed another PA form without his wife's permission, misappropriated the stamp of a co-worker (Beth Tractenberg), notarized the PA by forging the co-worker's name without her permission, and caused the PA to be filed and recorded with the Dutchess County Clerk's Office. Respondent used the forged PA to obtain the second Charter One mortgage by signing his wife's name to both the mortgage application and the mortgage without her permission and the mortgage documents were filed in the Dutchess County Clerk's Office.

Respondent's fraudulent conduct was discovered in the course of divorce proceedings commenced by his wife in 2006. Funds from the loans were allegedly used for familial purposes and deposited into respondent and his wife's joint account. Respondent has since assumed sole responsibility to pay the loans back and neither the banks nor the Dutchess County District Attorney's office have taken action against him with respect to his misconduct.

There were some sympathetic circumstances. Nonetheless:

Giving due consideration to these factors, we nevertheless find that this case is distinguishable from those in which attorneys received short suspensions. Respondent's misconduct in obtaining three mortgages, from two lenders, by fraud, over a period of three years was repetitive, deliberate and deceitful. While respondent strongly disputes that his multiple acts of forgery constitute an aggravating "pattern of misconduct," we disagree.

Significantly, respondent's misconduct included the misappropriation of the notary stamps of his work colleagues and the forgery of their signatures. This not only put his own career in jeopardy, but also adversely impacted his colleagues and his firm. We further note that while respondent stresses his cooperation and remorse, he had many opportunities to reconsider and admit his wrongful conduct, but did not do so, remaining silent until it was brought to light by others.

(Mike Frisch)

http://lawprofessors.typepad.com/legal_profession/2011/07/an-attorney-who-engaged-in-a-pattern-of-deception-was-suspended-for-three-years-by-the-new-york-appellate-division-for-the-fi.html

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