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Iowa Supreme Court Board of Professional Ethics and Conduct v. Jones2/16/2000
The other letter, dated March 26, 1997, purportedly came from the director of investigations for the Federal Republic of Nigeria. The letter was not addressed to anyone but purported to be a "Letter of Clearance and Confirmation of Funds." The letter stated that the director had "thoroughly investigated the source of the sum of U.S. $25.3 million belonging to Mr. Leon Currie as proceeds due for a contract executed in Nigeria in 1985." The letter also stated that " he payment is not for laundering or drug business. You may accept the funds in the beneficiary's account as it has been certified genuine and incontroversial ."
Delbert asked Jones why he could not make the loan. Jones replied, "I can't do that. He's my client." Jones never told Delbert that banks and other individuals had refused to loan money for the endeavor or that the transaction was risky. Nor did Jones tell him that, if Jones successfully secured the $5000 loan and the contract money, Currie would purchase for Jones a two-million-dollar annuity. When Delbert commented that he did not know Currie, Jones replied, "Well, he's my client. He's good. He's good."
Delbert trusted Jones, and based on Jones' representations that the endeavor was sound, Delbert borrowed $5000 for thirty days from his credit union and obtained a cashier's check in that amount payable to Jones. Delbert delivered the check to Jones, who endorsed it and forwarded it to Currie. When Delbert commented that he had no guarantee of repayment, Jones signed on Currie's behalf, a handwritten, thirty-day promissory note payable to Delbert.
Not surprisingly, Delbert has not received any money from the transaction, and according to Jones, Currie is in poor financial condition. The credit union gave Delbert two thirty-day extensions on his $5000 loan. At the end of ninety days, Delbert paid the loan together with interest at nine percent.
II. Proceedings.
The board filed a complaint against Jones, alleging misconduct on his part arising out of the $5000 debt that Delbert incurred. The complaint charged that Jones had violated Iowa Code of Professional Responsibility for Lawyers DR 1-102(A)(4) (lawyer shall not engage in conduct involving misrepresentation); DR 1-102(A)(6) (lawyer shall not engage in conduct reflecting adversely on fitness to practice law); and DR 7-102(A)(7) (lawyer shall not counsel or assist client in conduct that lawyer knows to be illegal or fraudulent). Jones responded to the Board's requests for admissions and later appeared at a hearing on the matter before the grievance commission. Jones and Delbert were the only witnesses the commission heard.
Following the evidentiary hearing, the commission filed its findings of fact, conclusions of law, and recommendation of discipline. The commission noted that there was no evidence that Jones knew—at the time of requesting the loan—that the Nigerian transaction was fraudulent. Based on this lack of evidence, the commission found that Jones had neither assisted nor counseled Currie in the commission of a fraud and had not himself otherwise engaged in fraudulent activity. The commission therefore concluded that the board had not proven a violation of DR 7-102(A)(7).
However, the commission did find that Jones' actions and omissions in obtaining the $5000 loan from Delbert constituted a misrepresentation. The commission therefore concluded that the board had proven a violation of DR 1-102(A)(4) and DR 1-102(A)(6). The commission recommended a public reprimand.
III. Scope of Review and Burden of Proof.
Jones has not appealed from the commission's recommendation under Court Rule 118.11. Nevertheless, we
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