Disciplinary Counsel v. Bennett

[Cite as Disciplinary Counsel v. Bennett, 124 Ohio St.3d 314, 2010-Ohio-313.]

DISCIPLINARY COUNSEL v. BENNETT.

[Cite as Disciplinary Counsel v. Bennett, 124 Ohio St.3d 314, 2010-Ohio-313.]

Attorney misconduct, including engaging in conduct involving dishonesty, fraud,

or deceit — Indefinite suspension, with credit for time served under

felony-conviction interim suspension.

(No. 2009-1100 — Submitted August 11, 2009 — Decided February 4, 2010.)

ON CERTIFIED REPORT by the Board of Commissioners on Grievances and

Discipline of the Supreme Court, No. 08-037.

__________________

Per Curiam.

{¶ 1} Respondent, Clyde Bennett II, formerly of Mason, Ohio, Attorney

Registration No. 0059910, was admitted to the practice of law in Ohio in 1992.

On February 15, 2008, we suspended respondent’s license to practice on an

interim basis pursuant to Gov.Bar R. V(5)(A)(4) upon receiving notice that he had

been convicted of a felony. See In re Bennett, 117 Ohio St.3d 1401, 2008-Ohio-

594, 881 N.E.2d 270.

{¶ 2} The Board of Commissioners on Grievances and Discipline

recommends that we now suspend respondent from practice for one year and give

him credit for the time his license has been under the interim suspension. The

board made this recommendation based on findings that respondent had structured

financial transactions to avoid federal reporting requirements for transfers in

excess of $10,000, the illegal conduct that led to his conviction. We agree that

respondent violated ethical standards incumbent upon Ohio attorneys but hold that

an indefinite suspension, with credit for the interim suspension, is the appropriate

sanction.

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{¶ 3} Relator, Disciplinary Counsel, charged respondent with violating

two Disciplinary Rules of the Code of Professional Responsibility: DR 1-

102(A)(4) (a lawyer shall not engage in conduct involving dishonesty, fraud,

deceit, or misrepresentation) and 1-102(A)(6) (a lawyer shall not engage in

conduct that adversely reflects on the lawyer’s fitness to practice law). The

parties waived an evidentiary hearing and filed agreed stipulations in which

respondent admitted the cited misconduct and the parties proposed that he receive

a one-year suspension with credit for the time served since his February 15, 2008

interim suspension. A panel of three board members recommended acceptance of

the agreed stipulations and proposed sanction. The board adopted the panel’s

report, accepting the stipulations and recommendation.

Misconduct

{¶ 4} The parties stipulated to respondent’s violations of DR 1-

102(A)(4) and (6), and to the following underlying facts:

{¶ 5} 1. “On September 26, 2007, respondent pled guilty to a one-count

Bill of Information alleging a Class C Felony in violation of 31 USC §5342(a)(3)

and (d)(2) [sic, 5324(a)(3) and (d)(2)] and 18 USC §2 for unlawfully structuring

financial transactions, Case No. 3:07CR144.”

{¶ 6} 2. “On December 28, 2007, U.S. District Court Judge Thomas

Rose sentenced respondent to 24 months in prison and a $4,000 fine.”

{¶ 7} 3. “Under 31 USC §5313, certain federal regulations, namely 31

CFR §§ 103.11 and 103.22, required domestic financial institutions to prepare and

file FINCEN Form 104 whenever they were involved in the payment, receipt, or

transfer of U.S. Currency exceeding $10,000.”

{¶ 8} 4. “At all times herein, respondent was aware of such regulations.”

{¶ 9} 5. “Structuring occurs when a person conducts one or more

currency transactions at one or more financial institutions (or different branches

of the same financial institution), on one or more days. One does this with the

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January Term, 2010

purpose of evading currency transaction reporting requirements. Structuring

includes breaking down a single sum of currency over $10,000 into smaller sums

or conducting a series of case [sic] transactions all at or below $10,000 with the

purpose of evading currency transaction reporting requirements.”

{¶ 10} 6. “During a five-month period, respondent unlawfully structured

approximately $124,300 with various financial institutions located around

Cincinnati, Ohio for the express purpose of evading the above-mentioned

reporting requirements.”

{¶ 11} 7. “A majority of $124,300 was currency respondent had obtained

from previously cashed paychecks that were issued to respondent by his employer

* * *.”

{¶ 12} 8. “A certain unspecified portion of the currency transactions

identified below originated from income that respondent received, but improperly

failed to report and account to the Internal Revenue Service. The following

paragraphs illustrate respondent’s criminal activity.”

{¶ 13} 9. “On August 15 and 16, 2002, respondent unlawfully structured

$18,000 in U.S. Currency by making the following deposits:

“• $4,000 at Fifth Third Bank, 916 Main St., Cincinnati

“• $5,000 at Fifth Third Bank, 201 E. Fourth St., Cincinnati

“• $3,000 at Fifth Third Bank 38 Fountain Square, Cincinnati

“• $6,000 at Fifth Third Bank, 916 Main St., Cincinnati.”

{¶ 14} 10. “Between September 11, 2002 and September 13, 2002,

respondent unlawfully structured $29,300 in U.S. Currency by making the

following deposits:

“• $7,000 at Fifth Third Bank, 38 Fountain Square, Cincinnati

“• $8,000 at Fifth Third Bank, 916 Main St., Cincinnati

“• $5,000 at Fifth Third Bank, 38 Fountain Square, Cincinnati

“• $3,000 at Fifth Third Bank, 5th & Broadway, Cincinnati

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“• $6,300 at Fifth Third Bank, 201 E. Fourth St., Cincinnati.”

{¶ 15} 11. “Between September 18, 2002 and September 20, 2002,

respondent unlawfully structured $20,000 in U.S. Currency by making the

following deposits:

“• $5,000 at Fifth Third Bank, 38 Fountain Square, Cincinnati

“• $8,000 at Fifth Third Bank, 38 Fountain Square, Cincinnati

“• $7,000 at Fifth Third Bank, 38 Fountain Square, Cincinnati.”

{¶ 16} 12. “Between September 23, 2002 and September 27, 2002, the

respondent unlawfully structured $32,000 in U.S. Currency by making the

following deposits:1 [Footnote sic.]

“• $8,000 at Fifth Third Bank, 916 Main St., Cincinnati

“• $7,000 at Fifth Third Bank, 38 Fountain Square, Cincinnati

“• $3,000 at Fifth Third Bank, 38 Fountain Square, Cincinnati

“• $4,000 at Fifth Third Bank, 5th & Broadway, Cincinnati

“• $4,000 at Fifth Third Bank, 38 Fountain Square, Cincinnati

“• $6,000 at Fifth Third Bank, 38 Fountain Square, Cincinnati.”

{¶ 17} 13. “Between September 28, 2002 and October 1, 2002,

respondent unlawfully structured $12,000 in U.S. Currency by making the

following deposits:

“• $2,500 at Fifth Third Bank, 1212 West Kemper, Cincinnati

“• $6,000 at Fifth Third Bank, 38 Fountain Square, Cincinnati

“• $3,500 at Fifth Third Bank, 201 E. Fourth St., Cincinnati.”

{¶ 18} 14. “On January 14 and 15, 2003, respondent unlawfully structured

$13,000 in U.S. Currency by making the following deposits:

“• $9,000 at Fifth Third Bank, 38 Fountain Square, Cincinnati

1. “Respondent pled guilty to unlawfully structuring transactions between September 23, 2002 and

September 27, 2002. The remainder of the transactions were not included in the Bill of

Information.”

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January Term, 2010

“• $4,000 at Fifth Third Bank, 38 Fountain Square, Cincinnati.”

{¶ 19} 15. “As part of the plea agreement, respondent agreed, that if

necessary, he would file corrected U.S. Federal Income Tax returns for 2003 and

2004 within 120 days of the plea.”

{¶ 20} 16. “For the year 2003 and 2004, respondent and his wife filed

joint tax returns and paid $75,540 and $76,153 in federal income taxes

respectively.”

{¶ 21} 17. “To date, neither the IRS nor the U.S. Department of

Probation has advised respondent of the need to amend his 2003 and 2004 taxes.”

{¶ 22} We accept these stipulations and find that respondent violated DR

1-102(A)(4) and (6).

Sanction

{¶ 23} In determining the appropriate sanction for a lawyer’s misconduct,

we consider sanctions imposed in similar cases and whether aggravating or

mitigating factors under BCGD Proc.Reg. 10(B) weigh in favor of a harsher or

more lenient disposition. Citing no aggravating features, the parties stipulated to

the mitigating factors that respondent (1) does not have a prior disciplinary

record, (2) provided full and free disclosure to the board with a cooperative

attitude toward the proceedings, and (3) offered positive character evidence. See

BCGD Proc.Reg. 10(B)(2)(a), (d), and (e).

{¶ 24} The parties have also stipulated in mitigation that other penalties

and sanctions have been imposed for respondent’s illegal conduct ⎯ he was

sentenced to two years in prison and ordered to pay a $4,000 fine. See BCGD

Proc.Reg. 10(B)(2)(f). Although this is true, the punishment was for only a

portion of the violations committed. As part of a plea agreement with

prosecutors, respondent pleaded guilty to structuring $32,000 in transactions from

September 23 through 27, 2002, but he admits in the stipulations in this case that

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he structured other transactions as well. This reduces the weight of that

mitigating factor.

{¶ 25} We also find a number of aggravating factors applicable to this

case that the parties, panel, and board do not mention. First, although

respondent’s motive for illegally structuring financial transactions is not clear

from the record before us, the bill of information to which he pleaded guilty

stated that he structured the $32,000 transaction by making each deposit “into

another individual’s savings account.” Respondent apparently thought it was

worth the risk of prosecution for evading the reporting requirements for domestic

financial institutions. His criminal conduct thus manifests dishonest and selfish

motives, aggravating factors under BCGD Proc.Reg. 10(B)(1)(b). Respondent

also engaged in his illegal activity over a five-month period, making 23 separate

deposits at various banks, which constitutes a pattern of misconduct, an

aggravating factor under BCGD Proc.Reg. 10(B)(1)(c). An indefinite suspension

is therefore appropriate.

{¶ 26} We accept the parties’ proposal to credit respondent for his interim

felony suspension. In their stipulations, the parties list the following cases in

which lawyers who were convicted of felonies were given credit for the time their

licenses were under interim suspensions:

{¶ 27} “In Disciplinary Counsel v. Blaszak, 104 Ohio St.3d. 330, 819

N.E.2d 689, 2004-Ohio-6593, the Supreme Court of Ohio imposed a two-year

suspension with credit for time served after the respondent pled guilty to selling

witness testimony in a pending case. In Cuyahoga County Bar Assn. v. Garfield,

109 Ohio St.3d 103, 846 N.E.2d 45, 2006-Ohio-1935, the Ohio Supreme Court

imposed an 18-month suspension with credit for time served after finding that the

respondent pled guilty to one count of bank fraud for pledging a company’s

certificate of deposit as collateral for a personal loan. Id. In Disciplinary Counsel

v. Petroff, 85 Ohio St.3d 396, 709 N.E.2d 111, 1999-Ohio-400, the Ohio Supreme

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Court suspended Mark Petroff for one year with credit for time served after the

respondent pled guilty to attempting to evade federal income taxes. Id. After

Attorney William Seall was sentenced to four months in prison and a $7,000 fine

for conspiring to commit tax fraud, the Supreme Court of Ohio suspended Seall

for one year with credit for time served under the interim suspension. Dayton Bar

Assn. v. Seall, 81 Ohio St.3d 280, 690 N.E.2d 1271, 1998-Ohio-630.”

{¶ 28} Respondent is therefore indefinitely suspended from the practice of

law in Ohio; however, we grant credit for the time he has served under the

February 15, 2008 interim suspension order, In re Bennett, 117 Ohio St.3d 1401,

2008-Ohio-594, 881 N.E.2d 270, toward the two-year period that respondent must

wait before petitioning for reinstatement under Gov.Bar R. V(10)(B). Respondent

may petition for reinstatement upon completion of respondent’s supervised

release. Costs are taxed to respondent.

Judgment accordingly.

MOYER, C.J., and LUNDBERG STRATTON, O’CONNOR, O'DONNELL,

LANZINGER, and CUPP, JJ., concur.

PFEIFER, J., dissents and would impose the one-year suspension

recommended by the board.

__________________

Jonathan E. Coughlan, Disciplinary Counsel, and Joseph M. Caliguri,

Assistant Disciplinary Counsel, for relator.

Clyde Bennett II, pro se.

______________________

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