Wednesday, August 1, 2012

Disciplinary Charges Involve Bankruptcy Fraud

The Illinois adminstrator has filed a disciplinary complaint based on charges arising from the attorney's guilty plea to bankruptcy fraud.

In noting the criminal charges, the ABA Journal reported that the attorney formerly was a Kaye Scholer partner:

A former partner of Kaye Scholer has been indicted for bankruptcy fraud for not disclosing his involvement with a major creditor before he left the law firm in 2005.

Stephen Garcia, now 48, allegedly failed to disclose, as required, his considerable involvement with New York City-based Albert Fried & Co., a major creditor of Geneva Steel Holdings Corp. when he represented the Utah steel mill in a Chapter 11 bankruptcy matter, reports Crain's Chicago Business.

“I am very disappointed that these charges were brought, which I deny,” says Garcia, who is now a sole practitioner in Chicago, in an e-mail to the business publication.

Bankruptcy court records show Kaye Scholer settled a malpractice case over the Geneva representation last year, by paying $2 million, refunding $1.7 million in legal fees and waiving several hundred thousand dollars more, Crain's reports.

Michael Solow, who co-chairs Kaye Scholer's executive committee, declined to discuss the matter with Crain's, saying that firm has resolved the Geneva case and is not involved in any related matter.

(Mike Frisch)

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