Deplorable

The South Carolina Supreme Court disbarred an attorney for “deplorable misconduct”

On October 8, 2021, Respondent Cory Howerton Fleming was placed on interim suspension following reports of his misconduct in connection with Richard Alexander Murdaugh in various legal matters related to the death of Gloria Satterfield. In re Fleming, 434 S.C. 382, 864 S.E.2d 546 (2021). Respondent subsequently pled guilty to numerous state and federal criminal charges and was sentenced to an aggregate term of thirteen years and ten months in prison. Based on the following facts taken from the public record, we disbar Respondent for his deplorable misconduct and shocking abuse of the legal system in South Carolina.

Facts

The facts presented during the August 23, 2023 plea colloquy in Hampton County demonstrate that Respondent and Murdaugh worked independently and in conjunction to steal from clients over the course of at least a decade using various dishonest schemes. One scheme involved fabricating fraudulent litigation expenses that were never actually incurred. Respondent repeatedly stole settlement funds disguised as reimbursements for sham litigation expenses and disbursed other fraudulent litigation expenses directly to Murdaugh. Another scheme involved a pattern of retaining in trust an amount of settlement funds sufficient to cover any pending medical liens, then negotiating with medical providers to accept a lesser amount in satisfaction of those liens. However, rather than disbursing the remaining funds to the client after satisfying the reduced medical liens, Respondent converted certain excess funds for his personal use and fraudulently disbursed the remainder to Murdaugh.

A third scheme involved creation of a bank account intended to imitate Forge Consulting, LLC, a Georgia-based consulting company that specializes in brokering structured settlement annuities for lawsuit proceeds, among other things. Murdaugh created a bank account using the name “Forge” to make it appear as though client funds deposited into that account were being transferred into legitimate structured settlements. Respondent repeatedly claimed he did not know the imitation Forge bank account was an illegitimate vehicle through which Murdaugh stole millions from unsuspecting clients. However, the State’s evidence proves otherwise. Specifically, the State’s hearing exhibits plainly demonstrate Respondent knew the legitimate Forge Consulting entity merely assists in arranging structured settlements; it does not accept disbursements of settlement funds. Accordingly, “Forge” would never be a proper payee in disbursing escrow funds intended for a structured settlement on behalf of a client. The evidence also demonstrates Respondent knew that, for tax reasons, proceeds pursuant to a structured settlement agreement are not disbursed to a client or lawyer prior to being turned over to the settlement fund; rather, the funds must be disbursed directly from the settling insurance company to the settlement fund. Despite this knowledge, Respondent repeatedly directed that insurers forward settlement proceeds directly to his law firm. Respondent then directed that various disbursements of client funds be made out to the intentionally ambiguous payee of “Forge” and forwarded those funds to Murdaugh personally or to a post office box in Hampton, South Carolina, with no identifying cover letter, client identifiers, or
other information specifying the proper allocation of the funds into structured annuities. Respondent’s actions in diverting client funds to the imitation Forge account enabled Murdaugh to steal millions from unsuspecting clients.

Proof

Based on Respondent’s guilty pleas in state and federal court, there is no factual dispute about whether Respondent engaged in dishonest conduct, and it is conclusively established that Respondent engaged in conduct that violates the Rules of Professional Conduct. This satisfies ODC’s burden of proving that same misconduct in connection with the pending disciplinary proceedings.

…we dispense with further investigation by ODC and further proceedings before the Commission. Respondent is hereby disbarred from the practice of law in South Carolina. To the extent additional acts of misconduct by Respondent are subsequently discovered, this Court may issue a supplemental order detailing any such additional acts of misconduct and imposing additional sanctions where appropriate.

(Mike Frisch)