A B.C. lawyer who accepted $45,000 in $20 bills has been suspended for 10 weeks due to a multitude of financial irregularities.
According to a Feb. 15 Law Society of B.C. decision, Abbotsford-based lawyer Randle W. Howarth improperly used his firm’s trust account to receive $776,305 although he provided no legal services.
On one occasion he accepted $45,540 in $20 bills and made no inquiries as to what “legitimate economic activities” would generate so much cash in such small denominations.
Howarth did admit he’d heard the investor was a “drug dealer” but didn’t think the allegation was credible.
The decision says the lawyer also made “misleading or inaccurate” statements to the Law Society.
He told the Law Society he hadn’t received more than $7,500 in cash into his trust account when he’d actually received $96,907.
Howarth signed a consent agreement admitting to professional misconduct.
The decision says Howarth has been a lawyer since 1978 and practices in motor vehicle cases, civil litigation and creditors’ remedies.
The professional misconduct has to do with a sawmill mill investment Howarth was involved in 2014.
More than a dozen investors advanced $25,000 to Howarth for the sawmill venture and he deposited the cash into his trust account.
“Between September 2014 and August 2017, Howarth used his firm’s trust account to receive and disburse a total of $776,305.97… in circumstances where no substantial legal services were provided,” the decision reads.
“The lawyer failed to maintain or produce receipts for the cash accepted and deposited to trust. Furthermore, the lawyer did not maintain a cash receipt book that contained the payer’s signature, the lawyer’s/staff signature, and the file number on all receipts provided,” the decision says.
The sawmill venture then saw the lawyer accept $96,907 in cash from investors. Of the cash, $45,540 was in $20 denominations.
“He was not, but should have been, aware that large amounts of $20 bills were understood by some to be commonly generated in illegal activities,” the Law Society says.
“During the investigation, the lawyer pointed out that at the time of the misconduct at issue, he knew of no involvement in criminality by any of the investors. Although he subsequently became aware of an allegation that one of the investors was a ‘drug dealer,’ the lawyer did not regard this allegation as credible and was not aware of any legitimate basis for it having been made,” the decision reads.
The decision says the sawmill venture went bust and the lawyer lost $124,000.
The Law Society says the amount of money that moved through the lawyer’s trust account was significant.
“The admitted misconduct is serious and engages several professional conduct issues,” the Law Society said. “While the conduct arises out of a single matter (the purchase and operation of a sawmill business), the specific instances of the admitted misconduct are repetitive and lengthy in nature.”
Ultimately, Howarth was suspended for 10 weeks.
“The actions taken will serve as a personal deterrent to (Howarth), and as a general deterrent to the profession,” the decision reads.
This article was originally sourced from www.infotel.ca