License Foreclosure Imminent

The California State Bar Court Review Department has concluded that disbarment is the appropriate reciprocal sanction found to have engaged in fraud in federal bankruptcy court.

 Lynne Margery Romano was suspended indefinitely by the United States Bankruptcy Court for the Central District of California for professional misconduct after the court found she participated in a “series of abusive bankruptcy case filings for the sole purpose of delaying foreclosure.” Indeed, over the course of three years, Romano filed 82 fraudulent bankruptcy petitions on behalf of sham petitioners in order to mislead the court and defraud creditors. Her scheme involved her paralegal, whom she aided in the unauthorized practice of law (UPL). The bankruptcy court admonished that her tactics were “not acceptable in [bankruptcy court] or any other court as a pattern of behavior for an attorney.” (In re the Disciplinary Proceeding of Lynne Romano (Bankr. C.D. Cal. 2012) 2:12-mp-00104-TA.)

The court

 Romano intended to defraud creditors and the bankruptcy court. Her efforts involved an elaborate scheme whereby she utilized sham petitioners, primarily corporations that were non-existent or not in good standing, to hold a fractional interest in her clients’ real property in order to shield those clients from poor credit ratings. She did not intend to obtain bankruptcy discharges for her clients, only to delay foreclosures. Over the course of three years, Romano had the opportunity to consider the consequences of her behavior each time she filed another petition. And yet she continued unabated until the bankruptcy trustee took action.

 The court here found that the attorney engaged in a pattern of dishonest conduct. (Mike Frisch)