Lottery Winnings Fraud Draws Disbarment
The full Massachusetts Supreme Judicial Court affirmed a single justice’s disbarment
The misconduct at issue arises from the respondent’s representation of a client who won the Massachusetts lottery in August 2013. Shortly after the client received his winnings in a lump-sum payment, the client’s ex-girlfriend filed a complaint in the probate court, seeking an increase in child support. The probate court subsequently entered temporary orders prohibiting the client from spending or transferring his winnings (and later, certain automobiles), and appointed a receiver to hold the funds. After the first such order issued, the client began consulting with the respondent about the probate court matter and his lottery winnings. The hearing committee found, and the board accepted, that the respondent advised him on an (improper) strategy to conceal these assets from the probate court and the client’s ex-girlfriend by falsely claiming that a prior verbal agreement existed between the client and his brother to split the lottery winnings on a fifty-fifty basis.
The respondent contests this finding, intimating that such an agreement between the brothers did exist, or that, at the very least, the respondent believed as much. In so doing, he challenges testimony from the client that was explicitly credited by the hearing committee. That credibility determination, however, was not inconsistent with other findings or the over-all chronology of events.
The advice
In furtherance of the goal of improperly concealing the client’s lottery winnings, the respondent advised and assisted the client in pursuing a series of activities that the respondent knew to be fraudulent or in violation of court orders. These activities included setting up trust accounts for the sole purpose of secreting the lottery funds in the respondent’s interest on lawyers’ trust account (and periodically disbursing portions those funds to himself) in violation of orders of the probate court, making intentional misrepresentations about the client’s assets in court proceedings, and obstructing and filing a frivolous bankruptcy petition of behalf of the client for the sole purpose of staying enforcement of the probate court orders.
The costs of aiding the fraud
In the course of representing the client, the respondent also directed the client to sign an “oppressive and predatory” fee agreement, without explaining its terms, and a durable power of attorney that gave the respondent “sole discretion” to decide what work to perform and what fees to charge, without notice to the client or authorization.
Disbarment
As the board observed, there are also multiple factors to be weighed in aggravation of the respondent’s misconduct, and none to be weighed in mitigation. The respondent not only orchestrated a fraudulent scheme in which he intentionally misled the courts, the receiver, and the mother of his client’s children, but took advantage of an unsophisticated and vulnerable client with a limited education and mental health issues.
The single justice’s decision is linked here and recounts the story in more fulsome detail
This proceeding concerns Hayes’s representation of Randal J. LaMarche, Jr. In August 2013, LaMarche won a one-million-dollar lottery prize. He opted to receive a lump sum payment of $650,000, which amounted to $455,000 after taxes. On or about August 26, 2013, LaMarche received a $455,000 check made payable to him from the Massachusetts Lottery. He immediately began spending some of his winnings. Among other things, he purchased a 2013 Dodge pickup truck, a used Corvette, and a motorcycle.
On August 29, 2013, after learning ofLaMarche’s good fortune, Julie Kenney, who was LaMarche’s former girlfriend and the mother of his three children, filed a complaint for modification of a child support order that had been entered by the Probate and Family Court on March 31, 2010. LaMarche and Kenney had been involved since about 2003 in various proceedings in that court regarding paternity, custody, visitation, and child support relating to their three children.
(Mike Frisch)