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In re Simmonds9/22/2003
OPINION & ORDER
DISCIPLINARY proceeding instituted by the Grievance Committee for the Ninth Judicial District. The respondent was admitted to the Bar at a term of the Appellate Division of the Supreme Court in the Second Judicial Department on March 25, 1981. By decision and order of this court dated May 16, 2002, the Grievance Committee was authorized to institute and prosecute a disciplinary proceeding against the respondent and the issues raised were referred to the Honorable Vincent Pizzuto, as Special Referee to hear and report.
The Grievance Committee served the respondent with a petition containing two charges of professional misconduct. After a hearing on (*2)September 5, 2002, the Special Referee sustained both charges. The Grievance Committee now moves to confirm the Special Referee's report and to impose such discipline upon the respondent as the court deems just and proper. The respondent has neither cross-moved nor submitted any response to the Grievance Committee's motion.
Charge One alleges that respondent made, authorized, or ratified misrepresentations to a mortgage banking company for the purpose of supporting a loan application and that such conduct involves dishonesty, fraud, deceit or misrepresentation, in violation of Code of Professional Responsibility DR 1-102(a)(4) (22 NYCRR 1200.3 ).
In early 1996 the United States Attorney for the District of New Jersey began an investigation into mortgage banking fraud which concerned a scheme to fraudulently obtain loans from a New Jersey mortgage company, Parkway Mortgage, Inc. (hereinafter Parkway). The investigation revealed that in late 1995 or early 1996, a client, T.S., asked the respondent if he would represent V. in the purchase of T.S.'s home with the proceeds of a loan from Parkway. The respondent represented V. for a $1,000 fee.
Although T.S. informed the respondent that V. had the assets to close, he indicated that a letter from the respondent to Parkway, stating that the respondent was holding escrow money for V., was necessary in order to aid in the approval of V.'s loan. The respondent was aware that Parkway relied on a buyer's assets in approving loans and that it was being misled about V.'s assets.
The respondent authorized T.S. to write, sign, and submit such a letter under the respondent's name without knowledge of the amount of escrow being misrepresented. In February 1996 a Parkway representative telephoned the respondent and asked for a second updated letter verifying that the respondent was still holding approximately $67,000 in escrow for V. T.S. assured the respondent that V. needed substantially less than $67,000 to close and had that sum available to him from the settlement of a personal injury lawsuit. T.S. wrote the second escrow letter which he faxed to the respondent. This second letter falsely represented that respondent was holding approximately $67,000 in his Mortgage Escrow Trust Account on behalf of V. The respondent clipped off the fax trailer at the top of the letter and submitted it to Parkway.
In exchange for the respondent's cooperation, the United States Attorney in June 1996 entered into an agreement with the respondent whereby the government would not bring any potential charges against him arising from any misrepresentations made, authorized, or ratified by him for the purpose of supporting V.'s loan application.
Charge Two is predicated upon the allegations of Charge One and alleges that the respondent's conduct adversely reflects on his fitness as a lawyer, in violation of Code of Professional Responsibility DR 1-102(a)(7) (22 NYCRR 1200.3 ).
Inasmuch as the facts are undisputed,
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