A lawyer got disbarred for misusing his trust account funds. A strip club was involved
Originally published; 11 Feb 2020
A Daytona Beach attorney kept ignoring the Florida Bar’s requests for his records as it tried to find why a check on his trust account bounced.
Eventually, Brett Hartley owned up that part of the problem was he used his attorney trust account as a business operating account for Flash Dancers, a Jacksonville strip club he owned.
That’s the sexiest of the no-nos that got Hartley disbarred by the Florida Supreme Court. Other funds were commingled or stolen, including money from his father-in-law and brother-in-law. He lied to clients, abandoned clients and his communications with the Florida Bar and the referee in his discipline matters ranged from none to whenever, according to the Bar.
“Sporadic” was the term used to describe Hartley’s communication in the referee’s report that resulted in Hartley’s disbarment. The Florida Bar used the usual legalese to describe the end of Hartley’s Florida legal career:
“Hartley misappropriated funds from multiple clients and then made intentional misrepresentations to presiding judges in order to conceal what he had done.
Hartley also neglected client matters and failed to properly assure that his clients’ interests were protected when he was indefinitely suspended from the practice of law in a previous matter.”
The Flash Dancers finding actually came out of the “previous matter.”
In December 2017, a $355.19 check on Hartley’s trust account bounced. Wells Fargo told the Florida Bar. The Bar eventually started an audit that ran from Sept. 1, 2017, through Aug. 31, 2018. When the Bar heard from a Flagler County judge about Hartley’s behavior in court and heard complaints from Hartley’s former attorney, 11 former clients or representatives of former clients of Hartley’s, the Bar decided to check out his personal checking account at Chase, too.
At first, Hartley ignored the Bar’s records requests and subpoenas. Hartley’s partial compliance still counted as non-compliance, so, on Aug. 28, 2018, the state Supreme Court suspended Hartley until he came across with the records requested. Hartley remained under that suspension when he was disbarred.
The Bar already discovered Hartley using his attorney trust fund account as Flash Dancers’ operating account.
Hartley’s sworn statement on Aug. 8, as summarized in the referee’s report, said he and Flash Dancers employees deposited money in the trust fund account and paid operating expenses from that account.
Hartley “testified he did this because he was unable to locate a financial institution that would permit him to open a business checking account for an adult entertainment night club,” the report said.
Flagler County Judge D. Melissa Distler saw the documents in Hartley’s previous case and found a grand inconsistency. In an August 2018 violation of probation hearing in her court, Hartley and his client, Alexander Schaefer insisted Schaefer’s funds for restitution in a criminal case were in Hartley’s trust account. But earlier that year, Hartley’s attorney told the Bar that Hartley had no client funds in his trust account.
Schaefer was wrong. Hartley knew the money never was in his trust account because he’d told Schaefer to send the restitution money to what was his personal account. Schaefer wired $10,000 on Feb. 7, 2018.
In two days, that was down to $531.06. Hartley drained it with two withdrawals totaling $6,500: a MoneyGram, an ATM withdrawal, a United Airlines purchase, and trips to 7-Eleven and McDonald’s.
THE BYRNE ROBBERY
Hartley used the same misdirection on Deirdre Byrne, who hired Hartley to represent her elderly father in a business eviction lawsuit.
She wired $21,450 into what she thought was Hartley’s trust account on March 7 and 8, 2018. It was his personal account.
By March 27, that personal account balance was $13.31. None of Byrne’s money went for Byrne’s father’s case. It went to “MoneyGram payments, ATM withdrawals, purchases at United Airlines and various restaurants and convenience stores around Florida and Colorado.”
Later in the year, he did the same, save the United Airlines buys, with $4,875 Byrne deposited. When the court found for the plaintiff and ordered Byrne’s father to pay the court registry $26,325 in August 2018, Hartley should have had the money. Instead, he had a checking account that was $328.40 overdrawn and a trust account with $9.08.
Hartley stopped talking to the Byrnes after that, according to the referee’s report.
Schaefer and Byrne were two of the clients Hartley officially abandoned by not informing them of his suspension. After a suspension comes down, usually the attorney gets 30 days before it actually starts. This leaves time to notify all clients and opposing counsel, so they have time to adjust their business.
Hartley’s father-in-law, Jose DeSousa, was among the other clients who told the Bar about Hartley.
DeSousa hired his son-in-law to set up an irrevocable living trust.
He gave Hartley a $255,000 check in 2015 and told him to put $200,000 into funding the trust and $55,000 in an interest-bearing checking account for DeSousa.
Hartley put all the money in his business trust account and never gave DeSousa a copy of the living trust. When DeSousa asked for $5,000 from what was supposed to be his checking account in July 2018, Hartley gave him a $5,000 check on the law firm’s trust account.
Then, Hartley stopped payment on the check. DeSousa found this out when his bank dishonored the check. Hartley blamed the problem on an issue with the Florida Bar and said he’d pay his father-in-law within a week.
He didn’t. He also didn’t tell DeSousa about his suspension. He avoided DeSousa until October 2018, when he tried to sell a motorcycle helmet on Facebook. DeSousa called the number and demanded his $5,000.
Hartley said he’d used DeSousa’s money years before to buy real estate and he’d need to sell it to repay his father-in-law.
Jesus DeSousa, Hartley’s brother-in-law, told the Florida Bar that Hartley couldn’t account for what happened with his money from a Social Security disability settlement.