Opinion ID: 1866152
Heading Depth: 1
Heading Rank: 4

Heading: Fourth Count: Misrepresentations to the Board

Text: In the initial contact by the director's office, respondent was asked to account for the $82,500 paid to him by Peterson. In response, on June 30, 1989, respondent provided a three-page statement with an accounting attached which stated, falsely, that the accounting represented: (1) that the transfer of funds was from the law office trust account; (2) that the $7,500 Peterson paid in May 1982 was deposited in the same trust account; and (3) that all withdrawals were by check, transferring funds to the firm's business account. As the referee noted in the findings, the actual facts were as follows: A. Respondent knew that there were three separate accounts (law office trust account, CMA, and trust savings account) into which the Peterson funds had been deposited as trust funds. B. The May 1982 check for $7,500 was deposited in the business account. Although respondent did not intentionally misrepresent this fact on June 30, 1989  he testified that he had assumed the funds went into trust  he admits that he should have checked his records prior to responding to the director's office and making this representation. C. Respondent knew that withdrawals were made by charges and checks drawn against the CMA, and later transfers from a savings account and some withdrawals were not deposited to the business account. On July 20, 1989, the director made a second inquiry regarding details about the June 30 response. The director requested further documentation, including bank statements and deposit and withdrawal slips. On August 14, 1989, respondent provided various documents showing only some of the deposits and transfers. On August 22, 1989, the director made a third inquiry, this time requesting respondent's trust account books and records. On September 16, 1989, respondent revealed for the first time that there had been three accounts. He provided three subsidiary ledgers. These ledgers showed that the withdrawals and transfers were not made contemporaneously with the transactions, but were made in response to the director. Respondent also provided, for the first time, the CMA statements which showed withdrawals by credit card. The referee held, and respondent again conceded, that these misrepresentations to the director's office violated Minn.R.Prof. Conduct 8.1(a)(1), 8.4(d).