Friday, June 15, 2012

Federal To State Reciprocal Discipline Imposed

The New York Appellate Division for the First Judicial Department has imposed reciprocal discipline of a two-year suspension with reinstatement conditioned on proof of fitness in connection with matters investigated and sanctioned by the federal district and circuit courts.

The circuit court investigated neglect of appellate matters and imposed a six-month suspension. The court also ordered that the attorney not be appointed to CJA cases for a year.

The district court matter involved the following:

While the disciplinary proceeding was pending in the Second Circuit, an investigator appointed by the Southern District's Committee on Grievances (COG) was investigating allegations that respondent had been improperly soliciting inmates at certain detention facilities who were already represented by counsel, and improperly paying inmates for client referrals. The referral payments were allegedly made by respondent or his employees by making deposits into inmates' commissary accounts. Between August 2004 and February 2010, respondent allegedly made 139 deposits to 36 inmates totaling $17,905.

In July 2009, respondent admitted in a deposition that, inter alia, he did not maintain any [*3]escrow accounts for the handling of client funds in connection with his law practice. Rather, respondent used his personal checking account to handle both personal and client funds. Based on that testimony, the Southern District issued an order to show cause directing respondent to account for his apparent failures to segregate his personal funds from client funds and to maintain detailed records of transactions involving client funds. In April 2010, respondent submitted a response in which, according to the court, he failed to demonstrate compliance with DR 9-102's segregation and record keeping requirements...

In December 2010, respondent appeared for his continued deposition with counsel. During the deposition respondent testified that from 2003 to 2010, he did not maintain any detailed records for the personal checking account out of which he made deposits into inmates' commissary accounts. Respondent also testified that his bank statements for the account had been destroyed as a result of flooding in his basement in 2005 and 2007. The investigator questioned respondent in detail as to the deposits he made into the commissary accounts (which were for clients and non-clients). Respondent testified that he could not remember the details of many of the deposits, and, in some instances, he was simply making gifts of financial assistance.

Thereafter the Southern District directed respondent to demonstrate why it should not take disciplinary action against him based on admissions made during his deposition. Respondent submitted a response claiming that his bookkeeping failures were the result of a tumultuous personal life that included: a difficult divorce from his former wife, who for years suffered from personal problems; having to be the sole care provider for his three sons; and his own struggles with Attention Deficit Hyperactivity Disorder and prostate cancer. Respondent also argued that he had already suffered substantial professional hardship as a result of his interim suspension and urged the court not to censure, suspend, or disbar.

The court here found no basis to depart from the sanction imposed by the Southern District, which had found escrow and other violations. It does not appear that the Southern District found misconduct in the solicitation of clients or payment of referral fees. (Mike Frisch)

Bar Discipline & Process | Permalink

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