Saturday, April 09, 2016

Illinois Supremes Yank Bar Tickets From Five Attorneys, Issue Lesser Discipline To A Dozen Others; Lawyer Hanky-Panky Primarily Revolved Around Ripping Off Client Cash Or Otherwise Mishandling Their Funds

The Cook County Record reports:
  • Five attorneys were disbarred in Illinois and an additional dozen were suspended in the latest round of disciplinary actions handed down by the Illinois Supreme Court.

    Among those disbarred was attorney Christian Chenoweth, of Chicago. According to disciplinary reports posted by the Illinois Attorney Registration and Disciplinary Commission, which serves as an advisory body to the state high court on professional lawyer discipline, Chenoweth pleaded guilty in October 2014 to a charge of retail theft in Cook County Circuit Court.

    Further, the ARDC said Chenoweth’s alleged list of improprieties contributing to his disbarment included mishandling at least $10,000 of money related to clients’ real estate transactions. According to the ARDC report, Chenoweth received $10,000 in earnest money from a client who was selling some property, and was to hold it in escrow until the closing of the sale. Chenoweth, however, deposited the money into his business bank account, spent at least some of the money and, as of March 22, had not repaid the money to his former client, the report said.

    Further, the report said Chenoweth may have also mishandled more than $120,000 of another client’s money, held in a trust, related to other land transactions in Chicago. The report alleged Chenoweth also spent some of that money “for his own business or personal purposes.”

    Other lawyers disbarred by the state Supreme Court included:

    - Tanya Y. Brockington, of Homewood, who had been similarly disbarred in Georgia “for neglecting three immigration matters” and “failing to return unearned fees;”

    - Raymond L. Huff, of Peoria, who allegedly practiced law in 2015 while still serving a one-year suspension;

    - Larry J. Meyer, of Chicago, who allegedly “misappropriated more than $150,000 in client funds, provided incorrect information to clients about the funds that he received on their behalf, and borrowed $10,000 from a client without making the required conflict of interest disclosures;”

    - Emmanuel E. Okere, of Chicago, who allegedly misled “an elderly client” into giving him $20,000 to invest in a “fraudulent investment scheme,” as well as persuading the client to personally loan him additional money. The Supreme Court release said Okere also “charged excessive fees.”

    In addition to those disbarred, the state Supreme Court also suspended 12 other Illinois lawyers, including:

    - John W. Pleta, of Mokena, suspended on an interim basis and until further order of the court, after he was “charged in a disciplinary complaint with misappropriating more than $1.2 million in funds belonging to a probate estate,” the release from the court said;

    - Edmund B. Moran, of Chicago, for two years, effective April 12, 2016, and until he satisfies a judgment against him over his alleged mishandling of $360,000 in a family trust;

    - Bryan R. Bagdady, of Lisle, for one year. The court said Bagdady was accused of persuading a client to invest money “in two different ventures in which he had an ownership interest.” The client lost her investment, the court said;

    - David J. Fitzpatrick, of Des Plaines, one year, effective April 12, 2016, and ordered to pay restitution for his alleged actions to “not promptly pay approximately $30,000 he withheld from client settlements … and later converted those funds to his own use;”

    - Kenneth A. Leeds, of St. Louis, one year and until further order of the court, with the suspension fully stayed by a two-year probation retroactive to Sept. 30, 2014. According to the court, Leeds had also been suspended indefinitely in Missouri, with the suspension fully stayed by a two-year conditional probation period, for allegedly improperly mixing client money with his own and improperly advancing $6,000 to clients;

    - Anne Marie Beckert, of Chicago, for six months and until further order of the court, with the suspension stayed after 90 days by a one year period of probation, for allegedly failing to refund client costs and mishandling other client matters;

    - Steven W. Berg, of Springfield, 6 months, effective April 12, 2016, and ordered to pay restitution for unearned fees he received in connection with two workers compensation cases;

    - Cassidy A. David, of Chicago, 6 months, effective April 12, 2016, for allegedly writing a “backdated letter purporting to show that she had timely mailed a document to the county recorder,” and then telling her employer and the ARDC the letter was genuine;

    - James P. Greene, of Chicago, 90 days, effective April 12, 2016, and ordered to pay restitution after allegedly borrowing $10,000 from a client without making required interest disclosures and delaying in repaying the money, among other alleged ethical violations;

    - James A. Hajek, of St. Louis, Mo., six months and until further order of the court, with the suspension fully stayed by a one-year probation, retroactive to Oct. 28, 2014. According to the court, Hajek had been suspended indefinitely in Missouri for blending client money with his own business funds and paying personal expenses from that account.

    - James L. Karraker, of Anna, 90 days, effective April 12, 2016, and ordered to pay restitution for allegedly not returning an unearned fee to a client he had represented in a criminal case; and

    - David J. Peilet, of Chicago, 90 days, with the suspension stayed by a one-year conditional probation. According to the state, Peilet was accused of neglecting a client’s criminal appeal.

    The court also censured attorney Daniel G. Koryn, of Los Angeles, placing him on two year probation, retroactive to Oct. 16, 2014; and reprimanded attorney Ronald J. Kurpiers II, of Tampa, Fla.
Source: State Supreme Court disbars five lawyers, suspends dozen more for ethical violations.

See, generally, Frederick Miller, "If You Can't Trust Your Lawyer .... ?", 138 Univ. of Pennsylvania Law Rev. 785 (1990) for more on the apparent, long-standing tolerance for deceit by many in the legal profession:
  • This tolerance to deception is encouraged by the profession's institutional civility. Seldom is a fig called a fig, or a shyster a shyster. No, our euphemisms are wonderfully polite: "frivolous conduct," or a "lack of candor;" or "law-office failure;" or, heaven forbid, a "peculation," a "defalcation," or a "negative balance" in a law firms's trust account.

    There is also widespread reluctance on the part of lawyers --- again, some lawyers --- to discuss publicly, much less acknowledge, that they have colleagues who engage in deceit and unprofessional conduct.

    This reluctance is magnified when the brand of deceit involves the theft of client money and property, notwithstanding that most lawyers would agree that stealing from clients is the ultimate ethical transgression. [...] The fact is, however, that theft of client property is not an insignificant or isolated problem within the legal profession. Indeed, it is a hounding phenomenon nationwide, and probably the principal reason why most lawyers nationwide are disbarred from the practice of law.
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(1) The Client Protection Program of the Attorney Registration and Disciplinary Commission (ARDC) was established by the Supreme Court of Illinois to provide reimbursement to clients who have lost money or property because of dishonest conduct by lawyers admitted to practice law in the State of Illinois. The Program reimburses clients who cannot get reimbursement from the lawyers who caused their losses, or from other sources such as insurance. (But see Stolen Inheritances: I-Team lawyer warning, in which one Illinois victim said of the program, "Their rules are vague, ambiguous and they are applied at their own discretion, and you can't get a straight answer[.]")

For similar "attorney ripoff reimbursement funds" that sometimes help cover the financial mess created by the dishonest conduct of lawyers licensed in other states and Canada, see:
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.

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