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In re Disciplinary Proceedings Against Walsh

Supreme Court of Wisconsin

March 23, 2017

In the Matter of Disciplinary Proceedings Against Adam Walsh, Attorney at Law. Office of Lawyer Regulation, Complainant,
v.
Adam Walsh, Respondent.

         DISCIPLINARY PROCEEDINGS AGAINST WALSH

          PER CURIAM.

         ¶1 Attorney Adam Walsh has filed a petition for the consensual revocation of his license to practice law in Wisconsin pursuant to Supreme Court Rule (SCR) 22.19.[1] Attorney Walsh's petition states that he cannot successfully defend against the allegations of professional misconduct arising out of two Office of Lawyer Regulation (OLR) investigations concerning his conduct. An OLR summary of those investigations and of the potential allegations of professional misconduct is attached to Attorney Walsh's petition.

         ¶2 Attorney Walsh was admitted to the practice of law in Wisconsin in January 2008. He most recently practiced in Madison under the name Affordable Legal Services of Wisconsin. Attorney Walsh sold the law firm to another attorney effective January 1, 2015. He continued to work at the firm, however, until November 25, 2015.

         ¶3 Attorney Walsh has been the subject of professional discipline on one prior occasion. In 2015 he consented to the imposition of a private reprimand pursuant to SCR 22.09 for improperly using his client trust account credit card on three separate occasions to disburse trust account funds prior to the deposit and availability of those funds for the respective clients and for failing to maintain and to produce required trust account records. Private Reprimand 2015-1 (electronic copy available at https://compendium.wicourts.gov/app/raw/002757.html).

         ¶4 Attorney Walsh filed a petition for the voluntary resignation of his license to practice law in this state in June 2016. Because the OLR's response to that petition indicated that it was conducting an investigation regarding Attorney Walsh, his voluntary resignation petition has been held in abeyance. In light of his current petition, his petition for voluntary resignation is being dismissed pursuant to a separate order being issued simultaneously with this opinion.

         ¶5 The OLR summary attached to Attorney Walsh's petition for consensual revocation sets forth two main areas of investigation into potential ethical violations.

         ¶6 The first area involves Attorney Walsh's multiple instances of insufficient balances in his client trust account. Attorney Walsh maintained a client trust account at JP Morgan Chase Bank in Madison from November 19, 2010, until October 14, 2015. At the time he closed the account, Attorney Walsh withdrew for himself the remaining balance of $868.26. A check Attorney Walsh had issued against the trust account, however, was subsequently presented for payment on November 3, 2015, and was returned for insufficient funds. Attorney Walsh claims that he reimbursed the recipient of the trust account check via other means.

         ¶7 Although the OLR's investigation was hampered by Attorney Walsh's refusal or inability to provide records for his trust account, the available information shows that on multiple occasions, the trust account contained substantially less money than it should have in 2014 and 2015. For example, bank records show that the balance in the trust account was $469, 349.55 on May 31, 2014. At that time, the trust account should have contained at least $78, 351.86 in funds belonging to two clients, J.M.G. and M.J.E. Subtracting that amount from the balance would leave a remaining balance of $390, 997.69. This amount, however, was more than $50, 000 less than Attorney Walsh had previously admitted in a letter he should have been holding for another client, a substantial trust. Indeed, that amount would have been more than $78, 000 less than the amount identified in the March 28, 2014 annual report of the trust. Moreover, the limited records the OLR was able to obtain indicate that Attorney Walsh deposited over $589, 000 into his trust account on behalf of the trust, but those records also show total disbursements of only approximately $530, 000 to proper recipients of the trust's funds. Because the OLR has not been able to obtain complete records, it cannot tell whether there were other disbursements to proper recipients for which records are not available or whether Attorney Walsh converted some or all of the remaining trust's funds to his own use.

         ¶8 Similar possible shortcomings in disbursements of other client funds appear in connection with at least three other clients. The amounts that do not appear to have been disbursed to the clients or to other proper recipients, however, are substantially smaller than was the case with the trust's money. What is clear is that in at least one case, the balance of Attorney Walsh's client trust account dipped more than $30, 000 below the amount that should have been held in trust for just one client. Thus, that amount of client funds had to have been converted to the use of other clients or to Attorney Walsh's personal use.

         ¶9 Indeed, Attorney Walsh admitted to the OLR that starting at least as far back as 2011 he had placed substantial sums of his own money into the trust account and had not kept track of those funds. Given the fact that on multiple occasions the balance in his trust account was substantially less than the amounts that were owed to clients, one can only conclude that Attorney Walsh needed to deposit his own funds into the account at times to avoid overdrafts and to repay amounts he had previously converted to his own use.

         ¶10 In the course of its investigation, the OLR asked Attorney Walsh to produce a transaction register, client ledgers, and a monthly reconciliation for his trust account. Attorney Walsh failed to produce any of these requested records. He produced only a single bank statement for October 2015, the month prior to closing the account. His response to the OLR's request stated merely that he was no longer practicing law and that he did not possess any further records.

         ¶11 The OLR's summary indicates that its investigation of Attorney Walsh's handling of his client trust account involves Attorney Walsh's potential violations of the following Supreme Court Rules: SCR 20:8.4(c);[2] SCR 20:1.15(b)(1);[3] former SCR 20:1.15(b)(3);[4] former SCR 20:1.15(e)(4)c.;[5] former SCR 20:1.15(e)(6) and (7);[6] and former SCR 20:1.15(f)(1)a., b., and g.[7]

         ¶12 The second investigation that the OLR has been conducting relates to Attorney Walsh's representation of O.B. Attorney Walsh agreed to represent O.B. in attempting to have his felony convictions expunged or to seek a pardon for those convictions. According to his fee agreement with O.B., Attorney Walsh accepted an advanced flat fee of $1, 500 at or near the time of entering into the representation and deposited the advanced fee into his law firm's business account. Attorney Walsh claimed to the OLR that he had done work on O.B.'s behalf and was able to describe some of that work. According to the OLR's summary Attorney Walsh promised O.B. in July 2015 that he would be following up on a lead that required research, but warned that O.B. would likely be out of luck if the research did not yield favorable results. Attorney Walsh, however, failed to communicate the results of his research to O.B. He then failed to advise O.B. in November 2015 that he was leaving the law firm and was ceasing his practice of law. Attorney Walsh failed to provide O.B. with any of the notices that were required when an attorney placed an advanced fee into the attorney's business account and utilized the alternative advanced fee procedure outlined in former SCR 20: 1.15(b) (4m) .[8] Indeed, Attorney Walsh failed to provide O.B. with a final accounting that showed how he had earned the $1, 500 flat fee.

         ¶13 The OLR was unable to determine the full extent of Attorney Walsh's work on O.B.'s behalf because Attorney Walsh says that he is no longer in possession of his billing software, and the lawyer who purchased the law firm from Attorney Walsh states that she is unable to access Attorney Walsh's billing records.

         ¶14 The OLR's summary indicates in connection with Attorney Walsh's representation of O.B. that it is investigating possible violations of the following Supreme Court Rules: SCR 20:1.3;[9] SCR 20: 1. 4 (a);[10] SCR 2 0: 1.16 (d);[11] and former SCR 20:1.15(b) (4m).

         ¶15 Attorney Walsh's petition for consensual revocation asserts that he is seeking the consensual revocation of his license freely, voluntarily, and knowingly. He states that he cannot successfully defend himself against the allegations of misconduct summarized above and more fully described in the OLR's summary. Attorney Walsh also acknowledges that he understands he is giving up his right to contest any of the OLR's allegations, as well as his right to have the assistance of counsel in this matter. Finally, the petition acknowledges that if the court grants the petition and revokes his license, Attorney Walsh will be subject to the requirements of SCR 22.26 and, should he ever wish to seek the reinstatement of his license, the reinstatement procedure set forth in SCRs 22.29-22.33.

         ¶16 The OLR's summary and its recommendation in support of the petition make clear that it is not seeking a restitution award in this case. While it is clear that there were multiple instances of conversion of trust account funds (either for the benefit of other clients or for Attorney Walsh's personal use), the OLR states that it has not been able, given the limited records and information it was able to obtain, either to identify to whom restitution might be owed or to arrive at any reasonably ascertainable restitution amounts. The OLR further notes that despite the apparent looseness with which Attorney Walsh handled his client trust account, no individual has notified it that Attorney Walsh still owes him or her any money. Similarly, given the lack of billing records, the OLR cannot determine with any reasonable certainty that O.B. should receive a refund of any particular amount of his advanced fee from Attorney Walsh.

         ¶17 Having reviewed Attorney Walsh's petition, the OLR's summary of possible misconduct, and its written recommendation in favor of the petition, we conclude that the petition for consensual revocation should be granted. It is clear from the OLR's summary of misconduct allegations that Attorney Walsh treated his client trust account as if it were a community fund at his constant disposal. His disregard for the core ethical value of protecting the integrity of each client's funds and his complete rejection of any obligation to maintain the required records that are necessary to keep client funds in order represent serious breaches of his ethical obligations as a lawyer in this state. His ethical lapses are compounded by his apparent lack of diligence and communication in the representation of O.B. Moreover, the private reprimand previously imposed on Attorney Walsh demonstrates that there is a pattern of misconduct.

         ¶18 Given the OLR's admitted inability to determine whether any particular client or third party is owed any money by Attorney Walsh, and to arrive at a reasonably ascertainable amount, we have no choice but to accede to the OLR's request not to award restitution in this matter. We are disturbed that this outcome appears to result from Attorney Walsh's failure to create, preserve, and/or produce the necessary records. We note, however, that if Attorney Walsh were ever to seek the reinstatement of his license, he would be required to prove affirmatively that he had made full restitution to all persons injured or harmed by his misconduct. See SCR 22.29(4m).

         ¶19 Finally, because this matter is being resolved via a petition for consensual revocation without the need to appoint a referee or hold an extensive hearing, we do not impose any costs on Attorney Walsh.

         ¶20 IT IS ORDERED that the petition of Adam Walsh for the consensual revocation of his license to practice law in Wisconsin is granted.

         ¶21 IT IS FURTHER ORDERED that the license of Adam Walsh to practice law in Wisconsin is revoked, ...


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