PER CURIAM — The Grievance Committee for the Second, Eleventh, and Thirteenth Judicial Districts (hereinafter the petitioner) served the respondent with a verified petition dated January 10, 2017, containing two charges of professional misconduct. Related disciplinary proceedings were commenced against the respondent’s law partner (see Matter of Costello, _____ AD3d _____ [decided herewith]). On December 4, 2017, a joint pretrial conference was held, during which the respondent and his law partner, who are separately represented, agreed that there should be separate hearings for each matter. In a report dated July 25, 2018, the Special Referee sustained all of the charges against the respondent. The petitioner moves to confirm the Special Referee’s report, and to impose such discipline as this Court deems just and proper. The respondent’s counsel has submitted an affirmation in opposition together with a memorandum of law, in which he raises no objection to the Special Referee’s findings, and requests the Court to impose a six-month suspension with the right to file a motion for reinstatement two months before the expiration of the suspension.
The PetitionCharge one alleges that the respondent misappropriated funds entrusted to him as a fiduciary, incident to his practice of law, in violation of rule 1.15(a) of the Rules of Professional Conduct (22 NYCRR 1200.0), as follows:At all times relevant to this petition, the respondent was a partner with his son, Joseph Richard Costello (hereinafter together the partners), in Costello & Costello, P.C., a law firm in Brooklyn (hereinafter the firm). The firm maintained an attorney escrow account at TD Bank, account number ending in x-8885, entitled “Costello & Costello, P.C. Attorney Trust Account” (hereinafter the escrow account). A second attorney escrow account was maintained by the firm at TD Bank, account number ending in x-0998. Both partners of the firm were signatories on the escrow accounts.In or about 2011, the firm was retained to represent Michael Donahue at a real estate closing. After the closing, on or about November 3, 2011, monies totaling $680,388 were deposited into the escrow account on behalf of Donahue. Shortly thereafter, the firm issued Donahue three escrow checks in the sums of $250,000, $200,000, and $1,638.70, respectively. Two of the Donahue escrow checks were promptly presented for payment and cleared the escrow account. The check payable to Donahue for $200,000 was not presented for payment until June 19, 2012, approximately six months after it was issued. On March 12, 2012, three months prior to that check being presented for payment, the balance in the escrow account had fallen to $180,572.89. When the $200,000 check was presented for payment on June 19, 2012, the balance in the escrow account was $106,878.23.Charge two alleges that respondent failed to maintain the required bookkeeping records for his attorney escrow accounts, in violation of rule 1.15(d) of the Rules of Professional Conduct (22 NYCRR 1200.0), as follows:The respondent allegedly failed to maintain accurate records of all deposits in and withdrawals from his attorney escrow accounts, and failed to accurately record the date, source, and description of each deposited item, as well as the date, payee, and purpose of each withdrawal or disbursement.
