The Names Were Changed To Protect The Guilty

An attorney convicted of a federal offense was disbarred by the New York Appellate Division for the Second Judicial Department.

The court described the offense

On May 22, 2012, after a jury trial, the respondent was found guilty in the United States District Court, Middle District of Florida, Tampa Division, of conspiracy to commit wire fraud, a felony, in violation of 18 USC § 371. During his trial testimony, the respondent admitted facts which established that he engaged in a scheme to misappropriate the CUSIP number (i.e., the nine-character number that identifies a security) and trading symbol of publicly traded companies that had become dormant as a result of a failure to pay taxes or to make required annual filings. The respondent and his codefendant created new private companies with the same names as the existing public dormant companies. They then changed the names of the new private companies and submitted false applications to CUSIP Global Services in which they made it appear as though the newly named companies were continuations of the original, dormant public companies, rather than the renamed new private companies, by referencing the existing CUSIP numbers of the dormant public companies. In this way, the respondent was able to create new private shell companies that had all the appearances of being active publicly traded companies, without having to go through the expense and process of actually making the new private companies publicly traded. The respondent admitted that he used this process to create approximately 55 such new companies. He further admitted that some of the clients to whom he sold these companies went on to use the new companies to perpetrate frauds on investors overseas who had no way of knowing that they were buying shares of stock in sham companies. The respondent was sentenced on August 9, 2012, to a term of imprisonment of 18 months, to be followed by a term of supervised release of 3 years and participation in a home detention program as a condition of his supervised release.

The court determined that disbarment was an automatic consequence of the conviction. (Mike Frisch)