Cops Pinch Attorney For Allegedly Failing To Refund $100K Buyer's Deposit Held In Escrow On Real Estate Deal That Ultimately Failed To Close

In Hilton Head, South Carolina, The Island Packet reports:

• A Beaufort County lawyer is accused of fraud for taking $100,000 from a client's escrow account and using it to buy a car and pay alimony and other personal and business expenses, according to court and law enforcement records.
  
  Stephen Edward Carter, 61, of Port Royal, who operated the Carter Law Firm on Hilton Head Island, was charged Wednesday with breach of trust fraudulent intent.
  
  Carter was in charge of an escrow account in a deal to purchase half ownership in the Palmetto Bay Marina on Hilton Head Island.
  
  Hilton Head resident Jason Bullock had given Carter $250,000 in earnest money in February 2014 on an offer to buy 50 percent of the marina from Carter's client Douglas W. James for about $4.6 million. James is a member of Cross Island Associates LLC, which owns the marina.
  
  Carter disbursed $150,000 as authorized, but was supposed to keep $100,000 in the account until the deal closed. The deal didn't close, and in October 2014, Bullock sued James and Cross Island Associates to get the earnest money back. The suit said the deal was ready to close, but James could not be found to complete the transaction.
  
  Carter filed a counterclaim, saying the closing's failure was Bullock's fault.
  
  On Dec. 2, 2014, Beaufort County Master in Equity Marvin Dukes ordered the $100,000 that was supposed to be left in the escrow account to be put in a trust account with the county clerk of court.
  
  Carter did not comply. He also did not appear at a contempt of court hearing March 2, 2015.
  
  That same day, Dukes reported Carter to the S.C. Office of Disciplinary Counsel.
  
  ***
  In September, Bullock reported Carter to the Sheriff's Office.
  
  Carter was disbarred in November by the state Supreme Court and ordered to pay the money, with interest and legal costs by the end of 2015. But that didn't happen.
  
  The court's disbarment opinion said Carter admitted to using the money to purchase a vehicle, pay alimony arrears, and to pay for office and personal expenses.
  
  After being charged with breach of trust [], he was released from the county jail [] on a $50,000 personal-recognizance bond.

For the story, see Beaufort County lawyer allegedly takes $100,000 from client's account.

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(1)The Lawyers Fund for Client Protection, established by the South Carolina Supreme Court and administered by the South Carolina Bar, reimburses clients for money or property mishandled by Bar members.

For similar "attorney ripoff reimbursement funds" that attempt to clean up the financial mess created by the dishonest conduct of lawyers licensed in other states and Canada, see:

• Directory Of Lawyers' Funds For Client Protection (now includes a listing for Canadian client protection funds, courtesy of the American Bar Association);
• Check the USA Client Protection Funds Map;
• Check the Canada Client Protection Funds Map.

Maps available courtesy of The National Client Protection Organization, Inc.

See generally:

• N.Y. fund for cheated clients wants thieving lawyers disbarred, a July, 2015 Associated Press story on this Fund reporting that the Fund's executive director, among other things, is calling for prompt referral to the local district attorney when the disciplinary committee has uncontested evidence of theft by a lawyer injuring a client or an admission of culpability;
  
  When Lawyers Steal the Escrow, a June, 2005 New York Times story describing some cases of client reimbursements ("With real estate business surging and down-payment amounts rising with home prices, the temptation for a lawyer to filch money from a bulging escrow account and later repay it with other clients' money has never been greater, said lawyers who monitor the thefts."),
  
  Thieving Lawyers Draining Client Security Funds, a December, 1991 New York Times story that gives some-real life examples of how client security funds deal with claims and the pressures the administrators of those funds may feel when left insufficiently financed as a result of the misconduct of a handful of lawyer/scoundrels.