Former State Auditor Disbarred
The Washington State Supreme Court has disbarred an attorney
Troy X. Kelley was convicted of eight federal felonies, including possession and concealment of stolen property, making false declarations, and filing false income tax returns. Based on those convictions, the disciplinary hearing officer recommended disbarment and the Washington State Bar Association (WSBA) Disciplinary Board (Board) agreed in a 5-3 decision. We agree with the Board’s recommendation to disbar Kelley.
Respondent had no prior record and is also admitted in California and the District of Columbia
He has also served three terms in the Washington State House of Representatives and one term as Washington State Auditor beginning in 2012. Additionally, Kelley has served 28 years in the military and is now retired. He has also been enrolled as a tax preparer with the United States Internal Revenue Service for calendar years 2022 and 2023.
Jury verdict
In December 2017, a jury convicted Kelley on counts 1, 2, 5, 11, 12 through 15, and 17. Count 1, possession and concealment of stolen property, relates to the reconveyance fees Kelley charged his clients between 2008 and 2012. Counts 2 and 5 involve false declarations made by Kelley while testifying in a civil deposition. Counts 12 through 15 and 17 relate to filing false income tax returns in 2008, 2009, 2012, 2013, and 2014.
He had appealed the conviction up the United States Supreme Court, which denied certiorari.
He fought disbarment
Kelley caused harm when he engaged in dishonest and deceitful conduct by possessing stolen money from his clients, making false declarations, and filing false income tax returns. This is evident from him having to pay restitution, even if some of his clients did not expect a refund, this is actual monetary harm to his clients. Furthermore, making false declarations in a deposition and on a declaration filed in court harms the legitimacy of our legal system. At the very least, Kelley created potential injury to the public and legal system by creating distrust in our institutions, especially since Kelley held positions of authority within our government. The conduct here supports a presumptive sanction of disbarment.
Asserted mitigation
Kelley argues that the Board did not consider the collateral consequences resulting from his convictions that were inflicted on him and his family. He cites to facts outside the record such as bad press, a raid on his home, the inability to open a bank account, death threats, and harassment. The mitigating factor he seeks appears to fall under Standards std. 9.32(k), which provides that the imposition of other penalties or sanctions is a mitigating factor. This court has found that the collateral consequences of a criminal conviction, including negative publicity and a prison sentence, are insufficient to establish the application of this factor.
Other cases
Instead, Kelley refers without any citations to the former governor of Alabama who was convicted seven times, sentenced to seven years in prison, and is still a member of the Alabama State Bar. He also references former WSBA president Robin Haynes, who was allowed to become an inactive member of the bar after she pleaded guilty to stealing money from two law firms and from the WSBA. However, Haynes was disbarred in Idaho, and WSBA recommended reciprocal discipline of disbarment be imposed. Kelley argues that WSBA’s initial decision to not impose discipline after Haynes stole law firm or client money and public bar funds means he should similarly not be disbarred. We find the unsubstantiated references to the governor of Alabama and to former president Haynes unpersuasive.
Dissents below
Three dissenting Board members voted against the disbarment recommendation and one of the three voted to reject the findings of fact and conclusions of law. Neither the Board nor the dissenters explained the basis for their positions.
The Washington State Standard reported on the disciplinary proceedings and linked to the oral argument before the court. (Mike Frisch)