SYLLABUS

(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the 

convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the 

interest of brevity, portions of any opinion may not have been summarized.)

In the Matter of Frank J. Cozzarelli, An Attorney at Law (D-151-13) (074742)

Argued October 21, 2014 -- Remanded October 30, 2014 -- Reargued November 10, 2015 -- Decided May 2, 

2016

PER CURIAM

In this attorney disciplinary matter, the Court considers the appropriate level of discipline for respondent 

Frank J. Cozzarelli, who committed misconduct involving the misappropriation of client and escrow funds.

Since 1998, respondent had been intermittently under investigation by the United States Attorney’s Office 

for income tax evasion. In connection with his role as treasurer of a fraudulent investment fund, respondent was 

indicted on September 21, 2004, after which he suffered a breakdown. On September 26, he was voluntarily 

admitted to an inpatient psychiatric unit, from which he was discharged on October 4, the day of his arraignment. In 

January 2005, respondent pled guilty to income tax evasion and was sentenced to four months in jail, followed by 

four months of house arrest and a probationary term. He was incarcerated from June through October 2005.

Shortly before the indictment, on August 2, 2004, Office of Attorney Ethics (OAE) Auditor Mimi Lakind 

notified respondent that a random audit would occur at his office at the end of that month, encompassing a two-year 

period prior to the audit date. The audit ultimately commenced in November 2004, after respondent had been 

released from inpatient care and while he remained under psychiatric care. According to Lakind, respondent 

maintained an active practice, including many real estate transactions per month and an active chancery docket. She 

asserted that respondent initially did not provide her with any recordkeeping documents, other than some records 

prepared by a family member who was a certified public accountant. In light of the criminal matter, Lakind 

postponed the audit. Although she requested additional documents, she never received them. Respondent was 

temporarily suspended in February 2005 following his guilty plea, at which time Lakind proceeded to reconstruct 

respondent’s records based on subpoenaed bank records and other documents. 

A demand audit ultimately resumed on December 18, 2008, at which time respondent presented Lakind 

with “new records” he had prepared on an Excel spreadsheet. According to Lakind, these materials were not 

reflective of the records of which she was aware in November 2004. Significantly, Lakind explained that, in 

addition to respondent’s recordkeeping issues, she had uncovered “a systematic and continuing invasion of client 

trust funds for respondent’s law office and personal expenditures.” Respondent was charged with several counts of 

knowing misappropriation for: (1) misappropriating $112,728.93 in client funds for personal purposes; (2) 

improperly transferring funds from one client’s trust account to the account of another unrelated client; and (3) 

repeated occurrences of borrowing against trust accounts for personal purposes and to replenish other accounts. 

At the disciplinary hearing, respondent, citing In re Jacob, 95 N.J. 132 (1984), maintained that, in light of 

his debilitating depression, he should be absolved of improprieties or granted mitigation in terms of the quantum of 

discipline imposed. Respondent’s psychiatrist testified that, at the time of the audit, respondent was not functioning 

efficiently and was not competent to manage the trust funds. The OAE’s expert disagreed, asserting that 

respondent’s mental state did not support a finding of legal insanity, or any of the other conditions that would satisfy 

the Jacob standard. The special master rejected respondent’s Jacob defense, concluded that he knowingly 

misappropriated client funds, and recommended disbarment. Following a de novo review, the DRB concurred that 

the proofs were sufficient to establish knowing misappropriation on four of the nine charges. Like the special 

master, the DRB rejected respondent’s Jacob defense, concluding that his major depression did not satisfy the 

requisite standard for legal insanity and noting that he continued to function both personally and professionally 

during the time he misappropriated funds. Consequently, the DRB determined that respondent should be disbarred.

The Court ordered respondent to show cause on the disbarment recommendation and, following argument 

on the matter, remanded to the DRB for a more full analysis of the evidence submitted in connection with 

respondent’s Jacob defense. The Court retained jurisdiction. 

On April 20, 2015, the DRB reaffirmed its recommendation that respondent be disbarred for the knowing 

misappropriation of escrow and client funds. The DRB explained that the Jacob standard has been reiterated and 
2

applied by the Court, in In re Greenberg, 155 N.J. 138, 156-59 (1998), and other matters, functioning as the 

equivalent of the M’Naghten standard, the standard for legal insanity under criminal law. The DRB further 

explained that the Court has often referred to the Jacob standard as the inability to distinguish between right and 

wrong or to understand the nature and quality of one’s acts, and not as an impairment of judgment. With respect to 

respondent’s misconduct, the DRB noted that there was considerable evidence demonstrating that he had not 

suffered a loss of competency or will such that his knowing misconduct could be excused. Specifically, he handled 

numerous professional and personal matters while managing to conceal the federal criminal investigation from his 

wife. The DRB explained that depression does not satisfy the Jacob standard unless it deprived the attorney of the 

knowledge that he was taking funds that did not belong to him and that he was not authorized to take. 

HELD: There is clear and convincing evidence the respondent knowingly misappropriated client funds, and that his 

mental illness did not cause him to suffer a loss of competency, comprehension or will that excused his misconduct 

when it occurred. Respondent is not entitled to mitigation and shall be disbarred.

1. In New Jersey, disbarment is permanent. R. 1:20-15A(a)(1). An attorney who knowingly misappropriates funds 

from a client is subject to disbarment without any practical prospect of consideration of mitigating factors or 

restoration upon a showing of reformation. In re Wilson, 81 N.J. 451 (1979). Misappropriating attorneys claiming 

to be afflicted with identifiable disorders, such as mental illness, have not swayed the Court from imposing 

disbarment. (pp. 18-19)

2. In Jacob, supra, the Court rejected the argument that an attorney’s medical condition exculpated his 

misappropriations, emphasizing that it was looking for a causal connection between the condition and the financial 

misdeed. The Court further stated that the attorney had not demonstrated that he had suffered a loss of competency, 

comprehension, or will of a magnitude that could excuse his knowing egregious misconduct. Although these 

comments reference a standard that traces language used in diminished capacity cases, several subsequent cases in 

which a so-called Jacob defense was advanced collapsed the standard into shorthand in which it is described 

essentially as an ability to discern right from wrong. In Greenberg, supra, the Court rejected an attorney’s asserted 

defense that his depression caused an impairment of judgment that should allow him to avoid disbarment for stealing 

law firm funds. The Court explained that the attorney failed to demonstrate that he could not appreciate the 

difference between right and wrong or understand the nature and quality of his acts. (pp. 19-22) 

3. The DRB applied Jacob, Greenberg, and other cases to the matter at hand, concluding that the Jacob standard 

requires either an inability to distinguish between right and wrong or to understand the nature and quality of one’s 

acts. Those two expressions of understanding can be likened to the standard for legal insanity, under the M’Naghten

test, and the standard for diminished legal responsibility under principles of diminished capacity or the statutory 

defense of intoxication. While the Jacob standard may not be a model of clarity, it nevertheless expresses the 

Court’s willingness to consider defenses that would negate the mental state to act purposely. Thus, a mental illness 

that impairs the mind and deprives the attorney of the ability to act purposely or knowingly, or to appreciate the 

nature and quality of the act he was doing, or to distinguish between right and wrong, will serve as a defense to 

attorney misconduct and should be considered in connection with excusing wrongful conduct by an attorney, or 

when mitigation of a disciplinary penalty is appropriate to consider under New Jersey’s disciplinary jurisprudence. 

(pp. 22-23) 

4. Here, the experts agreed that respondent did not have a mental illness that met any of the aforesaid three defenses 

that negate the mental state to act knowingly. While the Court agrees with respondent that the Jacob standard is not 

restricted to making a showing that is equivalent to the M’Naghten standard for legal insanity under criminal law, it 

rejects respondent’s contention that the DRB’s decision is undermined by its focus on the legal insanity standard. 

The DRB correctly concluded that the OAE has proven knowing misappropriation by clear and convincing 

evidence, and the Court concludes that respondent’s misdeeds were not aberrational. Respondent has not proven a 

causal connection between his mental illness and his acts of misappropriation, and the Court is not persuaded that he 

is entitled to mitigation of the normal penalty of disbarment due to his severe depression. On this record, as 

amplified by the supplemental decision of the DRB, respondent committed knowing misappropriation. 

Consequently, respondent is disbarred. (pp. 23-26)

So Ordered.

JUSTICES LaVECCHIA, ALBIN, and PATTERSON, and JUDGES CUFF and FUENTES (both 

temporarily assigned) join in this PER CURIAM opinion. CHIEF JUSTICE RABNER and JUSTICES

FERNANDEZ-VINA and SOLOMON did not participate.
1

SUPREME COURT OF NEW JERSEY

D-151 September Term 2013

074742

IN THE MATTER OF

FRANK J. COZZARELLI,

An Attorney at Law

Argued October 21, 2014 – Remanded October 

30, 2014 - Reargued November 10, 2015 –

Decided May 2, 2016

On an Order to show cause why respondent 

should not be disbarred or otherwise 

disciplined.

Maureen G. Bauman, Deputy Ethics Counsel, 

argued the cause on behalf of the Office of 

Attorney Ethics.

S.M. Chris Franzblau argued the cause for 

respondent (Franzblau Dratch, attorneys; Mr. 

Franzblau, Stephen N. Dratch and Frank J. 

Cozzarelli, on the briefs).

PER CURIAM

Respondent, Frank J. Cozzarelli, was recommended for 

disbarment in a decision by the Disciplinary Review Board (DRB). 

On the return date of an Order to Show Cause issued by this 

Court as to why he should not be disbarred for the knowing 

misappropriation of client and escrow funds, respondent 

contended that he presented mental illness evidence that had not 

received proper consideration by the DRB, under In re Jacob, 95 
2

N.J. 132 (1984). Because we were concerned about respondent’s 

assertion that his Jacob defense was not properly considered and 

addressed by the DRB, we extended these already lengthy 

proceedings by remanding the matter to the DRB for fuller 

examination and explanation, including but not requiring the 

possibility of further evidentiary proceedings. We retained 

jurisdiction.

This matter is presently back before us following the DRB’s 

issuance of a supplemental decision that, in greater detail, 

explains its adherence to its recommendation that respondent 

should be disbarred. We have had re-briefing and re-argument 

following issuance of the DRB’s supplemental decision. 

Before this Court, respondent continues to maintain that 

the DRB has misapplied Jacob. Respondent argues that he was 

entitled to have his Jacob defense of mental illness considered 

in connection with mitigation of penalty as well as for purposes 

of providing a defense to the charged misconduct. For the 

reasons expressed herein, we conclude that respondent’s 

arguments have received full and fair consideration. 

Based on the proofs, we agree with the DRB that there is 

clear and convincing evidence of knowing misappropriation of 

client funds, that respondent’s mental illness of depression did 

not cause him to suffer a loss of competency, comprehension or 

will that excused the acts of misappropriation when they 
3

occurred, and that he is not entitled to mitigation of our 

almost-invariable penalty of disbarment for such egregious 

misconduct based on the depression he undoubtedly suffered in 

connection with his federal investigation, indictment, plea, and 

sentence. We therefore accept the DRB’s recommendations and 

hold that respondent shall be disbarred based on the proof of 

knowing misappropriation of client and escrow funds. 

I.

In light of the extended history to this matter, we will 

summarize the salient procedural and factual aspects to this 

misappropriation-based disciplinary action. 

Following a full hearing culminating in a recommendation of 

disbarment by an appointed special master, the DRB unanimously 

recommended respondent’s disbarment for the knowing 

misappropriation of client and escrow funds charged in counts 

three, four, eight, and nine of the Office of Attorney Ethics’s 

(OAE) complaint, and for violation of RPC 8.4(c) (conduct 

involving dishonesty, fraud, deceit or misrepresentation) and 

RPC 8.4(d) (conduct that is prejudicial to the administration of 

justice). The charges arose out of audit irregularities,

including trust account shortages that were uncovered during a 

random audit, which turned into a demand audit, conducted by the 

OAE between November 22, 2004 and December 18, 2008. The 

lengthy duration of that audit needs to be placed in context.
4

On August 2, 2004, OAE Auditor Mimi Lakind notified 

respondent that a random audit would occur at his office at the 

end of that month and would encompass a two-year period prior to 

the audit date. The audit was rescheduled twice at respondent’s 

request. The audit did not commence until November 2004 and 

took a long time to bring to conclusion.1 

According to respondent, when the audit began in November 

2004, he was “not functioning very well” and was under 

psychiatric care. In fact, when respondent learned that an 

attorney ethics audit would take place, he was weeks away from 

being indicted by the United States Attorney’s Office for income 

tax evasion, for which he had been intermittently under 

investigation from 1998 until his indictment on September 21, 

2004 in connection with his role as treasurer of a fraudulent 

investment fund.

 

1 In the midst of responding to the OAE auditor’s requests for 

documents and information in connection with the audit, 

respondent was temporarily suspended on September 24, 2005, and 

the audit was indefinitely postponed. That suspension from the 

practice of law was due to respondent’s entry of a guilty plea 

to one count of income tax evasion, in violation of 26 U.S.C. § 

7201. In re Cozzarelli, 182 N.J. 387 (2005). On March 9, 2006,

well before the audit was brought to conclusion, the thirteenmonth temporary suspension from active practice that respondent 

had served was determined to constitute sufficient attorney 

discipline for the federal tax evasion offense, In re 

Cozzarelli, 186 N.J. 156 (2006); thereafter, respondent was 

reinstated to practice in January 2007. See In re Cozzarelli, 

189 N.J. 209 (2007). He has remained in active status 

throughout these proceedings.
5

Although not squarely germane to this matter, a brief 

history on what has been referred to by the DRB as “the Mallet 

Investment” is necessary. The special master report described 

the Mallet Investment venture succinctly as follows:

Through various persons, Respondent was 

contacted by an Edward Mallet, with whom 

Respondent developed a friendship. Mr. Mallet 

involved the Respondent in the development of 

schemes to create an Investment venture, and 

to that end ultimately [provided] Respondent 

with more than $10,000,000.00 ostensibly in 

order to obtain a fixed place of business for 

an “investment company” and to establish 

banking connections in the United States and 

Europe to attract investors and establish a 

“hedge fund.” Other parties to the scheme 

were introduced by Mr. Mallet, and it is 

reasonable to infer that Mr. Mallet intended, 

and did in fact use the Respondent as a “fall 

guy” by convincing Respondent to accept and 

handle monies, the source of which has not 

been established, and to transfer those funds 

to persons designated by Mr. Mallet, in some 

way to cause their disappearance.

Although the special master’s report noted that it was “clear . . 

. that Respondent had neither the knowledge [n]or experience to 

have concocted whatever scheme Mr. Mallet was engaged in,” 

respondent’s income tax evasion conviction arose from his 

failure to pay taxes on profits generated by those investments.

Based on the record as presented by respondent and as 

supplemented by his medical expert, by September 2004, 

respondent had known of the potential indictment for several 

months, was in a state of anxiety, and ultimately suffered a 
6

breakdown when he was informed that a federal grand jury had 

indicted him. During the days spanning September 21 through

September 26, 2004, respondent formulated a suicide plan and 

absented himself from family and friends to execute it, 

travelling in and around New Jersey, stopping in New York City, 

Atlantic City, and Philadelphia. Eventually he abandoned his 

suicide plan, reconnected with family and an attorney, and 

determined to face the criminal charges. Respondent had not 

told his family about the potential criminal charges beforehand. 

With familial, legal, and medical assistance,2 on September 

26, 2004, respondent was voluntarily admitted to an inpatient 

psychiatric unit in Valley Hospital. He was discharged on 

October 4, 2004. On the day of his discharge, respondent was 

arraigned in the United States District Court for the District 

of New Jersey. He pleaded guilty in January 2005 to income tax 

evasion and was sentenced to four months in jail, followed by 

four months of house arrest and a probationary term. He was 

incarcerated from June through October 2005.3 

 

2 Respondent’s admitting and treating psychiatrist, Dr. Steven S. 

Simring, testified in this matter as a fact witness and as 

respondent’s expert.

3 In sentencing respondent, the federal district court commented 

on the number of supportive letters that were submitted on 

respondent’s behalf and recounted respondent’s professional 

success and contributions to the community. The court expressed 

hope that respondent would be restored to the practice of law 

where he could continue to contribute. Those comments were 
7

The audit that OAE Auditor Lakind attempted to perform in 

November 2004 was therefore conducted after respondent had been 

released from inpatient care and while he remained under 

psychiatric care. According to respondent, he had counsel for 

some period during audit preparations but was unable to pay for 

ongoing representation. Assistance came from family members and 

others who helped to secure documents that had been requested by 

the OAE in advance of the audit. In Lakind’s testimony at the 

hearing before the special master, she said that respondent 

initially did not provide her with any recordkeeping documents 

other than some records prepared by a family member who was a 

certified public accountant; those did not detail whose money 

was whose among the various clients and accounts for which 

respondent was responsible. According to Lakind, respondent had 

maintained an active practice that involved many real estate 

 

relied upon by respondent in this matter and we give them 

favorable acknowledgment. However, they were expressed based on 

knowledge of only the federal conviction for tax evasion, which 

more likely than not results in suspensions from practice, not 

disbarment. See, e.g., In re Rakov, 155 N.J. 593 (1998) 

(imposing two-year suspension for attempted income tax 

evasion); In re Gillespie, 124 N.J. 81 (1991) (three-year 

suspension for aiding and assisting in presentation of false 

corporate tax returns); In re Nedick, 122 N.J. 96 (1991) 

(imposing two-year suspension for tax evasion mitigated by 

cooperation with federal authorities); cf. In re Turco, 66 N.J.

50 (1974) (imposing disbarment for tax fraud). The 

misappropriation charges were not yet in the picture as the 

audit had been postponed while respondent addressed his federal 

criminal charges.
8

transactions per month and included an active chancery docket. 

We also note that respondent held numerous court appointments as 

a fiduciary.4 Lakind testified that she also was provided with a 

disc that included a voluminous list purporting to identify all

of the files in respondent’s office.

Concerned about the level of stress that respondent was 

exhibiting during the November 2004 audit proceeding, Lakind 

informed respondent that the audit would be postponed so that 

respondent could focus on his federal criminal matter. On 

December 10, 2004, respondent was notified that the audit would 

resume in February 2005. Lakind testified that she requested 

additional records but never received them. Respondent was 

temporarily suspended by February 2005 as a result of the guilty 

plea in federal district court. Lakind testified that she 

proceeded to reconstruct respondent’s records, preparing

spreadsheets based on subpoenaed bank records and documents

received from succeeding trustees on respondent’s former 

fiduciary accounts, information listed on checks, and other 

documents. Lakind added that, following respondent’s 

 

4 In connection with respondent’s inability to provide Lakind 

with any recordkeeping documents in November 2004, we note that 

shortly after his arraignment in federal court, respondent was 

removed from his many court-appointed fiduciary positions and 

was faced with the obligation to turn over and account for the 

contents of funds that he had held as a fiduciary. The absence 

of respondent’s recordkeeping files is sorely troubling and is 

discussed later.
9

reinstatement to the practice of law, she received a Quickbooks 

form from respondent’s accountant, Samuel Fisher, which 

substantially agreed with her reconstructed figures. Respondent 

himself informed Lakind that he could not produce any additional 

records due to the disarray of his professional belongings while 

he was incarcerated.5 

When a demand audit resumed on the substantially later date 

of December 18, 2008, respondent presented Lakind with “new 

records” he had prepared on an Excel spreadsheet; however,

according to Lakind, those materials were not reflective of the 

records she was aware of in November 2004. 

More problematic for respondent, Lakind testified that in 

addition to the recordkeeping issues uncovered during the audit, 

she uncovered “a systematic and continuing invasion of client 

trust funds for respondent’s law office and personal 

expenditures.” Those patterns, she testified, revealed 

shortages in his accounts. According to Lakind’s testimony,

beginning with his own accountant’s 

reconciliation as of December 31st, 2003, 

there were shortages in the account. And then 

I found that money from the fiduciary accounts 

went into the Trust Account and were used to 

pay other clients.

 

5 Respondent testified that his brother, who was his landlord, 

took back his office space to lease it to a new tenant. 

Respondent’s belongings were removed to accomplish the releasing. Although respondent had packed and stored his records 

in an onsite trailer, he claimed the records became disarrayed 

or destroyed following the demolition work that took place.
10

The critical time came when Mr. 

Cozzarelli had to turn over a number of 

fiduciary accounts to other attorneys or 

successor trustees or administrators, and so 

the amounts that were held in the Trust 

Account had to be paid out and there was 

insufficient money to pay them.

And I found that just before the payment 

of each matter deposits were made from 

personal funds of Respondent equal to clear 

the checks. In all that time, and with all 

those shortages, not a single check, not one, 

was presented on insufficient funds and either 

paid or dishonored by the bank, none.

When asked if she would have expected no check to bounce if 

respondent’s records were in such poor condition that he could 

not keep track of financial matters, Lakind explained that she 

would have expected the opposite of what she in fact found.

That’s usually the best indication where 

an attorney has no idea what’s in there, will 

write a check thinking he’s probably got the 

money in there. That’s why we have the 

overdraft notification program, it’s exactly 

why it was put into effect, so that where an 

attorney, either through negligence or through 

design, does not have enough money and a check 

is presented, whether it’s paid or not, even 

if it’s paid, we are notified by the bank that 

a Trust Account was presented against 

insufficient funds and we immediately contact 

the attorney and we ask for proof of what 

happened and why that happened.

And in all this time I never found a 

single Trust Account bank statement in which 

there was an overdraft balance or [that a 

check written for an amount in excess of the 

account’s balance was returned]. . . . There 

was always sufficient funds at the moment a 

check was presented for the check to clear.
11

Following the conclusion of the demand audit, on December 

18, 2008, respondent was charged with several counts of knowing 

misappropriation for: (1) misappropriation of $112,728.93 in 

client funds for personal purposes; (2) improper transfer of 

funds from one client’s trust account to the account of another 

unrelated client; and (3) repeated occurrences of borrowing 

against trust accounts for personal purposes, including for fees 

he believed he was owed and to replenish other trust accounts.

At the disciplinary hearing, respondent maintained that,

because he suffered from the debilitating mental illness of 

severe depression, he should be absolved of improprieties or at 

the least granted mitigation in terms of the quantum of 

discipline to be imposed, citing Jacob, supra, 95 N.J. 132. Dr. 

Simring, a board-certified psychiatrist, testified on 

respondent’s behalf as an expert and as his treating physician. 

Dr. Simring opined that respondent was not functioning 

efficiently or rationally and was not competent to manage the 

trust funds at the time of the audit. The OAE’s expert, boardcertified psychiatrist Daniel Paul Greenfield, M.D., testified 

that, during 2003-2005, respondent’s mental state did not 

support a finding of legal insanity, or any of the other 

conditions that would satisfy the Jacob standard (mentioning 

also intoxication or diminished capacity as among those other 

conditions that could provide a form of Jacob defense but that 
12

were inapplicable to the present matter). Dr. Greenfield 

expressed his opinion that respondent’s depression was 

situational and that he was functional at the time when he 

engaged in the unethical conduct that formed the basis for the 

disciplinary charges against him.

The special master found that respondent knowingly 

misappropriated client funds. He rejected respondent’s Jacob

defense, finding that there was no medical evidence that 

respondent suffered from a mental illness sufficient to excuse 

his misappropriating conduct. As noted earlier, the special 

master’s report recommended respondent’s disbarment as the only 

appropriate discipline for his misappropriation of client funds.

Following a de novo review, the DRB determined that the 

evidence clearly and convincingly established that respondent 

was guilty of knowing misappropriation, although not on all 

counts. It found the proofs sufficient, under the clear and 

convincing standard, on four out of nine of the charges.

The DRB’s August 8, 2014, decision recounts the basis for 

its findings in full but, in sum, the DRB found as follows. 

With respect to count three, involving the Arthur R. Haberman 

Irrevocable Trust, the DRB concluded that the proofs established 

that respondent knowingly misappropriated $100,000 from that 

trust on November 3, 2004, to cover a shortage in another trust 

that respondent had been managing until he was removed, 
13

following his arraignment, from his court-appointed position of 

fiscal agent and replaced by another attorney. Similarly, with 

respect to count four, involving the Barrillas-to-Gencarelli 

real estate transaction, the DRB found that respondent failed to 

maintain the necessary funds in his trust account following the 

closing, having used $100,000 of the funds to reimburse the 

Haberman trust on February, 11, 2005. With respect to count 

eight, involving the Boyko Trust, the DRB determined that the 

evidence showed that respondent was not authorized to transfer, 

on May 5, 2004, $50,000 from the trust to his business account 

to pay legal fees in his criminal case. Finally, on count nine 

involving the Sciarrillo estate, the DRB determined that 

respondent provided no evidence to support his claim that the 

estate owed him $200,000, which he took from the estate between 

September 27, 2004 and November 1, 2005. 

The DRB also rejected respondent’s Jacob defense, 

concluding that respondent’s diagnosis of major depression did 

not satisfy the requisite standard for legal insanity to obtain 

relief under Jacob. To the DRB it was significant that, despite

his depression, respondent continued to function personally and 

professionally and that, during that time, he systematically 

engaged in “lapping,” or taking one client’s funds to pay 

obligations owed to another, while ensuring that the funds were 

replenished when it came time to repay the first client. 
14

Consequently, the DRB determined that respondent should be 

disbarred.

We issued an Order to Show Cause on the disbarment 

recommendation and, following argument on the matter, remanded 

to the DRB 

with instruction that the Board more fully 

assess the evidence submitted in connection 

with respondent’s proffered defense pursuant 

to In re Jacob, 95 N.J. 132 (1984), and provide 

a detailed explanation of whether or not 

respondent has met the standard set forth in 

Jacob. The Disciplinary Review Board retains 

the authority to remand the matter to a 

special ethics master if it deems such a 

course warranted.

We also retained jurisdiction.

In a decision dated April 20, 2015, the DRB reaffirmed its 

recommendation that respondent be disbarred for the knowing 

misappropriation of escrow and client funds. The DRB addressed 

in detail its reasons for rejecting respondent’s argument that, 

under Jacob, he should be excused or have his penalty mitigated 

due to his mental illness.

First, the DRB addressed the Jacob standard. The DRB 

quoted the standard first articulated in Jacob and noted that it 

has been reiterated and applied by this Court, in In re 

Greenberg, 155 N.J. 138, 156-59 (1998), and other matters, 
15

functioning as the equivalent of “the M’Naghten standard.”6 The 

DRB decision recited numerous occasions on which this Court has 

“referred to the Jacob standard as the inability to distinguish 

between right and wrong or to understand the nature and quality 

of one’s acts.” The DRB commented that neither the Jacob

standard nor the M’Naghten standard “is satisfied by a 

demonstration of an ‘impairment of judgment.’” 

Second, the DRB detailed why the evidence offered by 

respondent failed the Jacob test as the DRB understood it. 

Critically important, that analysis bears repeating in 

full:

[N]either respondent nor [Dr.] Simring, 

his expert, offered any evidence to support 

the conclusion that, at the time of the 

knowing misappropriations, respondent 

“suffered a loss of competency, comprehension 

or will of a magnitude that could excuse or 

mitigate egregious misconduct that was clearly 

knowing, volitional and purposeful.” Jacob, 

supra, 95 N.J. at 137. In respondent’s only 

instance of knowing misappropriation that 

preceded the September 2004 indictment, no 

evidence established that, at the time (May 5, 

2004), he was anything more than depressed. 

Respondent claimed that he was “in such a deep 

depression that [he] couldn’t figure out what 

was going on.” We note that there is 

considerable evidence to the contrary. He 

 

6 M’Naghten’s Case, 8 Eng. Rep. 718 (H.L. 1843); see also State 

v. Breakiron, 108 N.J. 591, 616 (1987) (“[T]he insanity defense 

as modified in New Jersey is strictly limited to the M’Naghten

principle of whether or not the defendant was either unable to 

know the nature and quality of the act he was doing . . . or, if 

he did know it, that he did not know that what he was doing was 

wrong.”).
16

handled quite a few personal and professional 

matters, during that time, and he was able to 

conduct himself in such a fashion that his 

wife had no suspicion that he was under a 

federal criminal investigation. Moreover, the 

inability to figure out “what is going on” is 

a far cry from not being able to distinguish 

between right and wrong.

As stated previously, depression, 

“however severe,” is insufficient to satisfy 

the Jacob standard, unless the condition 

deprived the attorney of the knowledge that he 

was taking funds that did not belong to him 

and that he was not authorized to do so. 

Greenberg, supra, 155 N.J. at 158-59. No such 

showing was established in this case.

. . . .

Finally, we note that, despite 

respondent’s insistence that his conduct was 

an aberration and that he has since reformed, 

the record shows otherwise. As we found, as 

late as September 2008, respondent gave the 

OAE a ledger that he had prepared for [a]

trust, after the fact. That ledger falsely 

showed that the $50,000 that respondent had 

paid to his lawyer in the federal criminal 

matter had gone to a beneficiary of the trust 

instead. Thus, nearly four years after 

respondent’s so-called breakdown, three years 

after his release from incarceration for 

having committed a felony, and despite his 

successful treatment with [Dr.] Simring, 

respondent was still engaging in dishonest 

conduct designed to conceal the fact that he 

deliberately and intentionally took monies 

that did not belong to him and used them to 

fund his defense in the federal criminal 

matter.

II.

Respondent argues that the DRB’s analysis on remand 

erroneously perpetuated an interpretation of the Jacob standard 
17

that requires a showing that meets the criminal law standard for 

the defense of legal insanity. He maintains that Dr. 

Greenfield, the OAE’s expert, applied only the M’Naghten

standard to assess respondent and opine on whether respondent 

could avail himself of a Jacob excuse to knowing 

misappropriation and disbarment. On the other hand, respondent 

maintains that his expert, Dr. Simring, opined on his mental 

illness and reasons why his mental condition merited mitigating 

consideration, which is also permitted under Jacob. In that 

regard, respondent argues that Dr. Simring’s opinion is 

unopposed. 

The OAE argues that the DRB properly considered the mental 

health circumstances that had been advanced by respondent and 

correctly concluded that proof of knowing misappropriation was 

demonstrated clearly and convincingly. It emphasizes the timing 

of the four incidents of misappropriation and that respondent’s 

expert, Dr. Simring, does not contend that respondent could not 

appreciate the wrongfulness of his actions at those times. In 

essence, the OAE maintains that respondent did not show 

impairment at the time of those misappropriations that deprived 

him of the ability to know that he was taking funds that did not 

belong to him and that he was not authorized to do so. 

Moreover, in arguing against allowing mitigating effect to 

be afforded to respondent in this disciplinary matter due to his 
18

diagnosis of severe depression by Dr. Simring, the OAE contends, 

and the DRB concluded, that three of the misappropriations took 

place after respondent had been discharged from the hospital, 

was under Dr. Simring’s care and responding well to medication, 

and was participating in the handling of his criminal matter. 

Thus, the OAE maintains that respondent’s misdeeds were not 

aberrational and, as further proof of that, adds one more 

incident to the mix. Four years after his hospitalization, 

three years after his incarceration, and still while under Dr. 

Simring’s care, respondent, according to the OAE, and as found 

by the DRB, submitted false information in financial records to 

hide evidence of misappropriation from another trust for which 

respondent was responsible. 

III.

In this State, two rules in attorney misconduct matters are 

applied, virtually without exception. First, disbarment is 

permanent. R. 1:20-15A(a)(1); see also In re Breslin, 171 N.J.

235, 237 (2002) (noting that “in New Jersey disbarment 

invariably is permanent”). Second, an attorney who knowingly 

misappropriates funds from a client is subject to disbarment, In 

re Wilson, 81 N.J. 451, 453 (1979), without any practical 

prospect of consideration of mitigating factors, id. at 457-60, 

or restoration upon a showing of reformation, id. at 460 n.5 

(noting that “research reveals only three orders of 
19

reinstatement following disbarment over the past hundred 

years”); see also Greenberg, supra, 155 N.J. at 151 (“We accept 

as an inevitable consequence of the application of th[e Wilson]

rule that rarely will an attorney evade disbarment in such 

cases.”).

Misappropriating attorneys claiming to be afflicted with 

identifiable disorders, including mental illness or related 

conditions, have not swayed the Court from imposing the grave 

discipline of disbarment. See Greenberg, supra, at 150, 157-58.

In Jacob, supra, the Court considered, as part of the 

defense to a knowing-misappropriation-of-client-funds case, a 

medical report by the physician of the respondent that addressed 

certain physical and mental health conditions, including 

depression, suffered by the attorney. 95 N.J. at 134-35, 137. 

The Court spoke sympathetically to the lawyer’s plight but 

nevertheless rejected the argument that the medical evidence 

served to “exculpate [the] misappropriations.” Id. at 136. The 

Court explained that the medical proofs did not demonstrate that 

the condition from which the respondent suffered “was an 

exclusive or major cause of his ethical derelictions.” Id. at 

137. The Court emphasized that it was looking for a 

demonstration of a causal connection between the medical 

condition and the financial misdeed. Ibid. The Court closed 
20

with the following restatement of its reasons for rejecting the 

proffered defense:

The report does not furnish any basis grounded 

in firmly established medical facts for a 

legal excuse or justification for respondent’s 

misappropriations. There has been no 

demonstration by competent medical proofs that 

respondent suffered a loss of competency, 

comprehension or will of a magnitude that 

could excuse egregious misconduct that was 

clearly knowing, volitional and purposeful.

[Ibid.]

Although the Court’s closing comments referred to legal 

excuse or justification, and mentioned “loss of competency, 

comprehension or will,” a standard that traces language used in 

diminished capacity analyses, several subsequent cases in which 

a so-called Jacob defense was advanced collapsed the standard 

into shorthand in which it is described essentially as an 

ability to discern right from wrong. See In re Hein, 104 N.J.

297, 302 (1986); see also In re Romano, 104 N.J. 306, 311 (1986) 

(concluding that “respondent has failed to demonstrate that a 

disease of the mind rendered him unable to tell right from wrong 

or to understand the nature and quality of his acts”). The DRB 

decision in this matter discusses subsequent cases that have 

attempted to argue for mitigation of penalty based on “loss of 

competency, comprehension or will” language that was used in 

Hein, explaining that the language actually originated from 

Jacob and requires loss of competency, comprehension or will of 
21

a magnitude that would excuse conduct that is otherwise knowing 

or purposeful. (Citing In re Steinhoff, 114 N.J. 268, (1989)). 

Most specifically, the Court in In re Roth, 140 N.J. 430, 448 

(1995), addressed mental illness in the context of whether an 

attorney lacked volitional capacity to perform his duties. The 

Court equated the loss of competency, comprehension or will as 

requiring an inability to distinguish right from wrong and 

concluded that the depression from which the respondent was 

suffering did not suffice to excuse his conduct under that 

standard. Ibid.

In another case, Greenberg, supra, 155 N.J. 138, our Court 

was asked to consider whether depression caused the respondent 

to suffer a substantial impairment of judgment that, when 

combined with other mitigating factors, should permit the 

attorney to avoid disbarment for stealing law firm funds. In 

rejecting the defense, our Court tied its rationale again to the 

lawyer’s failure to demonstrate that “he was unable to 

appreciate the difference between right and wrong or the nature 

and quality of his acts.” Id. at 157. The lawyer’s mental 

illness, although severe, did not eviscerate the lawyer’s 

knowledge that he was taking the firm’s funds and that his firm 

had not authorized the taking. Id. at 158-59; see also In re 

Tonzola, 162 N.J. 296, 307 (2000) (noting “the debilitating and 

overpowering effects of respondent’s illnesses,” but 
22

acknowledging respondent’s expert’s opinion that respondent “may 

have been aware” that clients’ funds were being 

misappropriated).

The DRB applied those cases to the matter at hand and 

concluded that the Jacob standard requires an inability to 

distinguish between right and wrong or to understand the nature 

and quality of one’s acts. Those two expressions of 

understanding can be likened to the standard for legal insanity, 

under the M’Naghten test, and the standard for diminished legal 

responsibility under principles of diminished capacity or the 

statutory defense of intoxication. See N.J.S.A. 2C:4-1 

(insanity); see, e.g., State v. Worlock, 117 N.J. 596, 603 

(1990) (“Directed at defendant’s ability to ‘know,’ the 

M’Naghten test is essentially one of cognitive impairment. 

Sometimes described as the ‘right and wrong’ test, its purpose 

is to determine whether the defendant had sufficient mental 

capacity to understand what he was doing when he committed the 

crime.”); N.J.S.A. 2C:4-2 (diminished capacity); see, e.g., 

State v. Taylor, 387 N.J. Super. 55, 61-62 (App. Div. 2006) 

(stating that, once affirmative defense of diminished capacity 

is raised, State must prove beyond reasonable doubt that, 

despite evidence of defendant’s mental disease or defect, she 

nonetheless “knew” that she was committing the relevant 

offense); N.J.S.A. 2C:2-8 (intoxication); see, e.g., State v. 
23

Mauricio, 117 N.J. 402, 418 (1990) (stating that “self-induced 

intoxication is a defense to a purposeful or knowing crime”). 

The Jacob standard may not be a model of clarity, but the point 

to Jacob is that it expressed the Court’s willingness to 

consider defenses that would negate the mental state to act 

purposely. A mental illness that impairs the mind and deprives 

the attorney of the ability to act purposely or knowingly, or to 

appreciate the nature and quality of the act he was doing, or to 

distinguish between right and wrong, will serve as a defense to 

attorney misconduct. The aforesaid defenses are ones that can 

and should be considered in connection with excusing wrongful 

conduct by an attorney, or when mitigation of the disciplinary 

penalty is appropriate to consider under our disciplinary 

jurisprudence addressing the quantum of punishment. 

Indeed, Dr. Greenfield noted the same defenses in his 

testimony, identifying all three as potential bases for avoiding 

legal responsibility under the attorney disciplinary system. In 

his testimony, Dr. Greenfield did not limit his understanding of 

a Jacob defense to legal insanity, as respondent argues, 

although respondent’s ability to distinguish right from wrong 

was the only one of the three possibilities that could apply to 

respondent’s mental condition and behavior. Dr. Greenfield 

stated that point more than once, and even Dr. Simring testified 

that respondent did not meet any of those three criteria for 
24

non-responsibility. There was no expert disagreement on the 

fact that respondent did not have a mental illness that met any 

of the aforesaid three defenses that negate the mental state to 

act knowingly. 

Respondent persists in maintaining that the DRB and the OAE 

mistakenly limit the Jacob standard to presentation of a 

successful insanity defense in a criminal matter and that 

nothing more will be considered. While we agree that the Jacob

standard is not restricted to making a showing that is 

equivalent to the M’Naghten standard for legal insanity under 

criminal law, we reject respondent’s contention that the DRB’s 

decision in this matter is undermined by its focus on the legal 

insanity standard as that was the only one of the three possible 

defenses that pertained in respondent’s situation. 

The DRB properly analyzed the record presented by

respondent and his expert as well as the testimony provided by 

the OAE’s expert. In our view, the DRB correctly concluded that 

the OAE has proven knowing misappropriation by clear and 

convincing evidence. Respondent did not demonstrate legal 

excuse for his misappropriations. Moreover, in light of the 

pattern and timing of respondent’s misappropriations and 

concealment well after having received care and ongoing 

treatment, we conclude that his misdeeds were not aberrational. 

This Court has previously noted the importance of establishing a 
25

causal connection between mental illness and the acts of 

misappropriation. See Jacob, supra, 95 N.J. at 137. Respondent 

has not proven an excusing causal connection. 

Nor are we persuaded that he is entitled to mitigation of 

the normal penalty of disbarment for his knowing, volitional, 

and purposeful acts of misappropriation of client and escrow 

funds. We reach that conclusion, notwithstanding Dr. Simring’s 

testimony urging that mitigation consideration be given to 

respondent due to his severe depression. In our disciplinary 

cases, we have not allowed mitigation from disbarment in 

misappropriation cases. This case does not present reason for 

us to start here. In Wilson, supra, we explicitly stated that 

“maintenance of public confidence in this Court and in the bar 

as a whole requires the strictest discipline in misappropriation 

cases. That confidence is so important that mitigating factors 

will rarely override the requirement of disbarment.” 81 N.J. at 

461. We also have been unswayed by the assertion that a 

respondent is unlikely to continue to misappropriate funds in 

the future. “[T]he unlikelihood of subsequent misappropriation 

[is] irrelevant in these cases.” Id. at 460 n. 4. This Court 

has not suggested that a low risk of re-offense is, in itself, 

“sufficient to warrant lesser discipline,” because it is “almost 

universally present in these matters.” Ibid.
26

We are satisfied that, on this record, as amplified by the 

supplemental decision of the DRB, respondent committed knowing 

misappropriation. We adopt the recommendation of the DRB that 

respondent be disbarred.

IV.

In the end, notwithstanding his being allowed to practice 

after his tax evasion conviction, respondent’s misappropriation 

has been proven by clear and convincing evidence. The penalty 

for that misconduct is disbarment.

JUSTICES LaVECCHIA, ALBIN, and PATTERSON, and JUDGES CUFF 

and FUENTES (both temporarily assigned) join in this PER CURIAM 

opinion. CHIEF JUSTICE RABNER and JUSTICES FERNANDEZ-VINA and 

SOLOMON did not participate.
SUPREME COURT OF NEW JERSEY

NO. D-151 SEPTEMBER TERM 2013

APPLICATION FOR

DISPOSITION Order to Show Cause Why Respondent Should 

 Not be Disbarred or Otherwise Disciplined 

IN THE MATTER OF

FRANK J. COZZARELLI,

An Attorney at Law

DECIDED May 2, 2016

OPINION BY Per Curiam

CONCURRING OPINION BY

DISSENTING OPINION BY 

CHECKLIST DISBAR

CHIEF JUSTICE RABNER -----------------

JUSTICE LaVECCHIA X

JUSTICE ALBIN X

JUSTICE PATTERSON X

JUSTICE FERNANDEZ-VINA -----------------

JUSTICE SOLOMON -----------------

JUDGE CUFF (t/a) X

JUDGE FUENTES (t/a) X

TOTALS

5

2