Lawyer Disbarred for Taking $91,749 From Client's Trust Account
The Disciplinary Review Board said MacLachlan used some of the money to pay for his daughter's horse riding lessons.
July 02, 2020 at 01:41 PM
3 minute read
Attorney Donald MacLachlan of Saddle River has been disbarred for taking $91,749 from a client's trust account for his own use, according to an order made public Thursday.
When MacLachlan took the funds, he knew they belonged to the client and that the client had not authorized him to use them, the court's Disciplinary Review Board said. MacLachlan was disbarred after failing to appear before disciplinary authorities to answer the charges.
MacLachlan came under investigation after Oradell attorney Robert Hitscherich submitted a claim to the Lawyers' Fund for Client Protection on behalf of the Irrevocable Trust of Guy A. Blehl. MacLachlan was placed on temporary suspension in October 2019 after making multiple, unexplained cash withdrawals from bank accounts associated with the Blehl trust.
MacLachlan had created the trust on behalf of Blehl, his client. Upon Blehl's death, MacLachlan collected $1 million in insurance proceeds and placed the money in three accounts, with 50% going to Blehl's widow, Sally, and 25% each to his son and daughter. Sally Blehl remained in regular contact with MacLachlan until she couldn't reach him in August 2017, according to the DRB.
In May 2018, the Bergen County Surrogate Court removed MacLachlan as trustee and replaced him with the dead man's brother, Allen Blehl, who obtained a forensic accounting audit of the trust. Among other things, the audit found that MacLachlan obtained seven certified checks from the trust account, totaling $24,335, payable to Willow Hill Farm, where MacLachlan's daughter received horseback riding lessons, the DRB said.
The court found MacLachlan should be disbarred for violating RPC 1.15(a), knowing misappropriation of client funds; RPC 1.15(b), failure to promptly disburse funds; RPC 8.4(b), commission of a criminal act that reflects adversely on a lawyer's honesty, truthfulness or fitness; and RPC 8.4 (c), conduct involving dishonesty, fraud, deceit or misrepresentation. The court also found MacLachlan's conduct met the conditions established by the state Supreme Court for disbarment following misappropriation in In re Wilson and In re Hollendonner.
In February 2018, the Department of Justice sued MacLachlan in U.S. district court to obtain judgments on more than $1.5 million in unpaid income and payroll taxes, and to foreclose on tax liens against his home.
The government's complaint in that case also seeks a determination of the interests of other parties named as defendants, including MacLachlan's wife, Marie Napoliello MacLachlan; the mortgage holder, Ocwen Loan Servicing; the New Jersey Division of Taxation; and the law firm of Riker Danzig Scherer Hyland & Perretti, which recorded a judgment against him in 2016.
Riker Danzig sued Donald MacLachlan and his firm in 2015, claiming it was owed more than $150,000 for work the firm performed after he sought its assistance with class action litigation he filed.
MacLachlan has not filed an answer in that case and no counsel has come forward to represent him. A motion to enter default judgment against him is pending.
MacLachlan could not be reached for comment. Messages were not being accepted at a telephone number listed in his name.
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