Attorney Grievance Comm'n of Md. v. Jalloh

461 Md. 228

192 A.3d 656

ATTORNEY GRIEVANCE COMMISSION OF MARYLAND

v.Jeneba Jalloh (GHATT)

Misc. Docket AG No. 2, Sept. Term, 2017

Court of Appeals of Maryland.

August 29, 2018

Argued by Ebtehaj Kalantar, Asst. Bar Counsel (Lydia E. Lawless, Bar Counsel, Atty. Grievance Commission of Maryland), for Petitioner.

Argued by Jeneba Jalloh (Ghatt) (College Park, MD), for Respondent.

Argued Before: Barbera, C.J., Greene, Adkins, McDonald, Watts, Hotten, Getty, JJ.

Getty, J.

This attorney disciplinary matter concerns a Maryland-barred attorney who acted as a facilitator in a complex money laundering scheme that induced investors to advance funds in exchange for a false promise of a full return of the advanced fees and a future construction loan under the guise of an escrow agreement. Specifically, Respondent Jeneba Jalloh Ghatt¹ ("Respondent" or "Ms. Ghatt") agreed that her law firm would serve as escrow agent, which in effect converted her attorney trust account into a repository for the advanced fee scam. Although Respondent may not have initially been a knowing participant involved in the complex fraudulent scheme, she ultimately became complicit in the scam when she failed to verify and safeguard the advanced funds and then misrepresented her disbursements of those funds. For these reasons, we disbar Ms. Ghatt.

On March 9, 2017, the Attorney Grievance Commission of Maryland ("Commission"), through Bar Counsel, filed with this Court a Petition for Disciplinary or Remedial Action ("Petition") against Ms. Ghatt. The Commission charged Respondent with violating Rules 1.15 (safekeeping property), 3.3 (candor to the tribunal), 8.1 (bar admission and disciplinary matters), and 8.4(a)-(d) (misconduct) of the Maryland Lawyers' Rules of Professional Conduct ("MLRPC").² The Petition also alleged the Respondent violated former Maryland Rules 16-607 (commingling of funds) and 16-609 (prohibited transactions),³ as well as Sections 10-306 (misuses of trust money) and 10-606 (penalties) of the Business Occupations and Professions Article of the Maryland Code. After the complaint was filed, Ms. Ghatt obtained the law firm Cunningham & Associates, PLC to represent her in the attorney grievance matter.

Pursuant to Maryland Rule 19-722, this Court designated the Honorable Krystal Alves of the Circuit Court for Prince George's County to conduct an evidentiary hearing ("the attorney grievance hearing" or "hearing") and to provide findings of fact and recommended conclusions of law. After being served with a copy of the Petition, Ms. Ghatt filed a Motion to Dismiss on June 6, 2017. After the circuit court denied the motion to dismiss, Respondent filed an Answer to the Petition on July 6, 2017. After the conclusion of discovery, Ms. Ghatt filed a Motion for Partial Summary Judgment, which the circuit court denied by order dated October 23, 2017. The attorney grievance hearing was held on October 23, 24, 25 and 26, 2017. Although she had previously obtained counsel, Ms. Ghatt represented herself throughout the attorney grievance hearing.

The attorney grievance hearing judge issued findings of fact and recommended conclusions of law on January 23, 2018. Specifically, the hearing judge concluded that the Respondent violated MLRPC 1.15(a), (b), (d), and (e); 3.3(a)(1); 8.1; and 8.4(a), (b), (c), and (d). In addition, the hearing judge further concluded that Ms. Ghatt violated former Maryland Rules 16-607 and 16-609 as well as Sections 10-306 and 10-606 of the Business Occupations and Professions Article ("BOP") of the Maryland Code.

Respondent filed exceptions to the hearing judge's findings of fact and recommended conclusions of law. Ms. Ghatt takes four extensive exceptions to the hearing judge's factual findings, arguing that the circuit court adopted the proposed findings of facts and conclusions of law submitted by the Commission in its entirety. In addition, Respondent excepts to the hearing judge's recommended conclusions of law regarding MLRPC 1.15, 3.3, 8.1, and 8.4 as well as Sections 10-306 and 10-606 of the Business Occupations and Professions Article. Ms. Ghatt does not take exception to the hearing judge's recommended conclusion that she violated former Maryland Rules 16-607 and 16-609. Ultimately, Ms. Ghatt requests that this Court impose a reprimand as the appropriate sanction in this case because she alleges the only violation was commingling of funds. On April 10, 2018, this Court heard oral arguments in this matter. Ms. Ghatt appeared and argued on her own behalf.

BACKGROUND

We summarize the hearing judge's findings of fact and the record submitted at the attorney grievance hearing as follows.

Ms. Ghatt's Law Practice

Ms. Ghatt was admitted to the Maryland Bar on December 16, 1998. After being admitted to the Bar of this Court, Ms. Ghatt worked as a staff attorney at Georgetown University Law Center, a lawyer at Willkie Farr & Gallagher, LLP, then served as assistant general counsel to the District of Columbia Office of Cable, Television, and Telecommunications. In 2007, Ms. Ghatt opened her own law firm, the Ghatt Law Group, LLC, in Prince George's County, Maryland. At the time she formed her solo law practice, Ms. Ghatt also formed what she called Strategic Partnership, which was an informal referral system between herself and two other out-of-state attorneys. During the period pertinent to this case, Ms. Ghatt worked as a solo practitioner at the Ghatt Law Group. Ms. Ghatt supplemented her solo practice with work as a blogger, columnist, and speaker.

In June 2007, Ms. Ghatt opened an attorney trust account at Citibank in the name of the Ghatt Law Group, LLC. The Ghatt Law Group attorney trust account has an account number ending in 8589. Ms. Ghatt signed a CitiEscrow Control Account Application, which provided that the Control Account Title was the Ghatt Law Group, LLC Attorney Trust. Ms. Ghatt also signed a General Deposit Resolution for Limited Liability Company, in which Ms. Ghatt listed herself as the sole signatory with authority to control and access the attorney trust account.

Escrow Agent Agreement with the Chore Group, LLC

Ms. Ghatt entered into an "Escrow Agreement" with Strategic Capital Enterprises (a Delaware limited liability company) and Zion Capital, Inc. (a Maryland corporation) that provided for funds to be deposited in escrow to the attorney trust account of the Ghatt Law Group, serving as the "Escrow Agent." The Escrow Agreement was signed by Zion Capital Ventures and Strategic Capital, LLC as a collective joint venture entitled "The Chore Group, LLC." The name Solomon Jalloh ("Mr. Jalloh’’), who Ms. Ghatt acknowledged is her brother, appears underneath the collective joint venture signature line as program manager and JV partner and principal. The Chore Group dated the Escrow Agreement on September 1, 2014. Although a signature line for the Ghatt Law Group, LLC, identifying Jeneba Jalloh Ghatt as managing partner, also appears on the Escrow Agreement, the signature and date line of the copy in the record appear blank.

The Escrow Agreement further provided that "the Escrow Agent is authorized to use the following funds transfer instructions to disburse funds without a verifying call-back [ ]. If distribution is in accordance with this Section [ ], by providing written instructions to the Escrow Agent in the form of Exhibit A, no call-back [ ] is required." Exhibit A to the Escrow Agreement was a Disbursement Request form, which states that a certain specified amount will be disbursed from the Ghatt Law Group's attorney trust account to an account identified by either Strategic Capital or Zion Capital. The Escrow Agreement also indicated that the "parties hereto agree that escrow fees shall be due and payable in the amount of $1,000.00 each month, and .05% of any disbursement upon which Escrow Agent must be a signatory of any agreement related to the release and control of funds."

As such, a plain reading of the Escrow Agreement indicates that Ms. Ghatt agreed to disburse an amount specified by Strategic Capital or Zion Capital from her firm's attorney trust account to an account also identified by Strategic Capital or Zion Capital. In return, Ms. Ghatt would receive $1,000 each month as well as half a percent of any disbursement that requires Ms. Ghatt to sign an agreement relating to the disbursement.

Grove Construction Management, LLC and Grove Plaza, LLC

Kraig Robinson was a partner of Grove Construction Management, LLC, a company owned by himself and Lyle Kenney ("Mr. Kenney") as equal partners. Mr. Robinson stated that Grove Construction Management assists clients in designing buildings. Mr. Robinson's role in Grove Construction Management was to deal with the contractors and engineers as well as supervise the field construction. Around 2008 or 2009, Grove Construction Management wanted to build a 45,000 square foot warehouse building on a piece of property adjacent to the company's current offices. In pursuit of that goal, the company obtained an appraisal of the building, which concluded that the project would cost $5,000,000.

Mr. Robinson and Mr. Kenney from Grove Construction Management, LLC contacted Gene Parrish from New Freedom Group, LLC, who indicated that he knew a company that could assist with funding the warehouse building project. New Freedom Group explained to Grove Construction Management that the funding company, Strategic Capital, required an appraisal and ten percent of the appraisal amount upfront. Therefore, Mr. Robinson anticipated that Strategic Capital would provide the complete funding amount, $5,000,000, as long as Grove Construction Management submitted the appraisal and ten percent of the funding amount, $500,000.

Mr. Robinson spoke with James C. Yates ("Mr. Yates" or "James Yates"), who he had met in either 2011 or 2012 after buying a piece of equipment from him.

After discussing the warehouse building project, Mr. Yates agreed to provide $500,000 to secure the funding in exchange for...