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Anthony Z. Szabo (WSBA No. 23210, admitted 1993), of Enumclaw, resigned in lieu of disbarment, effective January 9, 2008. In connection with his resignation in lieu of disbarment, Mr. Szabo admitted that the WSBA could prove by a clear preponderance of the evidence sufficient violations of the Rules of Professional conduct to result in his disbarment, but did not admit any specific misconduct. The misconduct and violations described in the Statement of Admitted and Alleged Misconduct (none of which are specifically admitted by Mr. Szabo) are as follows:
Mr. Szabo operated Escrow Authority II (EA II), a real estate escrow business in connection with his law practice. At all times relevant to these matters, Mr. Szabo had access to, control of, and responsibility for EA II’s trust account, including the passwords for the account. Substantial sums of money were deposited and disbursed from EA II’s trust account in connection with real estate closings. Mr. Szabo was responsible for maintaining and recordkeeping for the EA II trust account, including reconciling the account. Although he had possession of the bank statements, Mr. Szabo did not reconcile the trust account to the bank statements or to the client ledgers on a monthly basis.
In April 2002, Mr. Szabo prepared the incorporation documents for Western Trustee Services LLC (Western Trustee), which was owned by his law partner. Western Trustee handled reconveyances for EA II. Mr. Szabo also prepared the incorporation documents for Sammamish Title in October 2002. Mr. Szabo was manager of Sammamish Title, which handled the recording of documents for EA II. Mr. Szabo maintained, controlled, and was responsible for the bank accounts for Western Trustee and Sammamish Title, to which he deposited fees payable to Western Trustee and Sammamish Title. Mr. Szabo withdrew money from the Western Trustee and Sammamish Title bank accounts to pay bills for EA II, and otherwise treated the accounts as though they were EA II accounts.
Between April 2005 and March 2007, Mr. Szabo engaged in the following conduct, which involved one or more of the before-mentioned businesses and/or another real estate escrow business that Mr. Szabo later operated in connection with his law office, Action Escrow:
• Failed to disclose to clients that Western Trustee and Sammamish Title were affiliated with Mr. Szabo and/or with EA II, and that amounts paid to Western Trustee and/or Sammamish Title were actually payments to Mr. Szabo;
• Failed to maintain funds belonging to clients and other third parties in the EA II trust account;
• Failed to promptly pay to clients or to third parties the money belonging to them;
• Intentionally misappropriated funds belonging to clients, and thereby committing the crime of theft in the third degree, a violation of RCW 9A.56.050;
• Falsely notarized signatures on documents in violation of RCW 42.44.160 (official misconduct), RCW 9A.72.040 (false swearing), RCW 9A.60.050 (false certification that individuals appeared before you), RCW 40.16.030 (false statement on recorded instrument), and RCW 9A.60.020 (forgery);
• Assisted and/or induced two nonlawyer employees to falsely notarize documents and failed to properly supervise them;
• Failed to file a trust account declaration with the Bar Association as required by ELC 15.5 and failed to provide a response to a grievance in compliance with ELC 5.3(e).
Mr. Szabo’s conduct violated RPC 1.7(b), prohibiting a lawyer from representing a client if the representation of that client may be materially limited by the lawyer’s responsibilities to another client or to a third person or by the lawyer’s own interests, unless the lawyer reasonably believes the representation will not be adversely affected and the client consents in writing after consultation and a full disclosure of the material facts; former RPC 1.14(a), requiring all funds of clients paid to a lawyer or law firm, including advances for costs and expenses, be deposited in one or more identifiable interest-bearing trust accounts maintained as set forth in the rules; former RPC 1.14(b)(4), requiring a lawyer to promptly pay or deliver to the client as requested by the client the funds, securities, or other properties in the possession of the lawyer which the client is entitled to receive; RPC 5.3, requiring a lawyer with direct supervisory authority over a nonlawyer to make reasonable efforts to ensure that the person’s conduct is compatible with the professional obligations of the lawyer and making the lawyer responsible for the conduct of such a person; RPC 8.4(a), prohibiting a lawyer from violating or attempting to violate the Rules of Professional Conduct, from knowingly assisting or inducing another to do so, or from doing so through the acts of another; RPC 8.4(b), prohibiting a lawyer from committing a criminal act that reflects adversely on the lawyer’s honesty, trustworthiness, or fitness as a lawyer in other respects; RPC 8.4(c), prohibiting a lawyer from engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation; RPC 8.4(i), prohibiting a lawyer from committing any act involving moral turpitude, or corruption, or other act which reflects disregard for the rule of law; RPC 8.4(l), prohibiting a lawyer from violating a duty or sanction imposed by or under the Rules for Enforcement of Lawyer Conduct in connection with a disciplinary matter; and RPC 8.4(n), prohibiting a lawyer from engaging in conduct demonstrating unfitness to practice law.
Debra J. Slater represented the Bar Association. William Cameron represented Mr. Szabo. |