Opinion ID: 1880293
Heading Depth: 2
Heading Rank: 1

Heading: Failure to Cooperate in the Investigation and Making Misrepresentations to the Director

Text: The investigation of Terrazas was initiated in September 1995 when the Director received notice of a $481.40 overdraft in Terrazas' trust account. The Director sent Terrazas a letter requesting an explanation and copies of Terrazas' trust account statements. Based on the information received, the Director suspected that Terrazas tried to float non-existing funds between his trust account and his personal/business account. At the time of the suspected float, Terrazas' personal/business account had a negative balance. When the Director received the two checks that were used to make the suspected float, they each contained an annotation designating them as payment from a client. An investigator from the Director's office questioned Terrazas about when the annotations were made. Terrazas informed the investigator that he more than likely made them when he wrote the checks and that he never adds annotations after checks have been negotiated. Notes taken by a Director's office employee during a meeting with Terrazas confirm this statement. However, when the Director obtained copies of checks from the bank as they appeared when presented to the bank, the checks did not contain the annotations. After the hearing, the referee concluded that Terrazas' statements regarding when the check annotations were made were false. The referee further found that Terrazas was noncooperative and late in supplying information requested by the Director. The Director made repeated requests for information and documents that Terrazas did not fully comply with. A request for certain documents was sent to Terrazas in March 1996 to which Terrazas never responded. Further, Terrazas did not comply with discovery requests until after the court had entered an order for Terrazas to provide the documents. Terrazas called the Director's office and said his response was delayed due to an office move and personal health problems. On May 20, 1996, the Director received another notice of an overdraft in Terrazas' trust account and requested an explanation of this overdraft. Terrazas failed to respond to this request as well. Terrazas was then given notice of a panel hearing on the charges filed against him. Terrazas requested a continuance both before the hearing and on the morning of the hearing because of a conflict with scheduled trials and a deposition. The panel denied the request, and Terrazas left the hearing before any testimony was taken.