Shame, Disgrace, Pain--Been There

James Agar at the Grand Rapids Press reports on the sentencing of  "a 3d generation" lawyer, Nancy Dilley (pic) who along with her husband, Charles Rominger, Jr. are going to federal prison for a variety of tax offense including not filing returns, paying taxes due, and in the case of Mr. Rominger, actively evading payment of taxes.  They claim their financial problems can be traced to losses sustained in a Ponzi scheme. 

Obviously, I strongly relate to Ms. Dilley's circumstances, perhaps an excerpt from Mr. Agar's story will illustrate why I do:

As a third-generation lawyer in a prominent legal family, Nancy Dilley's court appearance Wednesday brought nothing but shame.  She stood before U.S. District Judge Paul Maloney in Kalamazoo, to be sentenced in a tax case. The charge was a misdemeanor, but nothing that Dilley – described as a nurturing mother, caring friend and hard-working, respected attorney – could have envisioned.

“She is mortally embarrassed and ashamed to have disrespected her family and the legacy that the Dilleys created over three generations,” attorney Mark Pendery wrote in a court filing.

Dilley, who earlier pleaded guilty to failing to file a federal tax return in 2007, was sentenced to eight months in prison [ . . . ]

Once released, she will serve one year on supervised release. She owes $86,703 in restitution.  She is to self-surrender when notified by the government.

Her husband, attorney Charles Rominger Jr. (pic), awaiting sentencing for tax evasion, asked that she avoid incarceration.   In court documents, he urged the judge to blame him, not his wife, for tax troubles. He faces up to five years in prison[.]   Rominger said that he is the “real target” of federal prosecutors, who used “my conduct to exacerbate Nancy's sentence.”

“In sentencing my wife, you should not attribute my conduct to her,” he wrote. “She is well regarded for her work ethic, honesty and compassion. She has served her family legacy well and is humbled by this shameful event.”

He asked Maloney to “not separate Nancy” from their son, “especially in light of my pending sentence.”

The couple failed to file federal tax returns from 2001-2007, Assistant U.S. Attorney Matthew Borgula said.  He said Dilley, living on a 68.5-acre horse ranch in Ada Township, has not provided an adequate explanation, Borgula said.

“For example, during 2006 and 2007 alone, over $350,000 in income flowed undetected through (Dilley) and Rominger's defunct bank accounts, from which the following disbursements were made: $16,415 to clean the house and provide in-house day-care, $57,780 to American Express … $8,200 in care payments for expensive cars registered to third parties … ,” Borgula wrote.

He said, however, that Dilley had “genuine remorse … from the guilt of staining the Dilley family name.”

Dilley, a life-long Grand Rapids-area resident, had no previous criminal record. Her family, friends, clients and pastor wrote letters on her behalf. Former Kent County Circuit Judge Dennis Kolenda said he never expected to vouch for a defendant's integrity, but wrote: “Nonetheless, although I regret the circumstance which necessitates my first such letter, I write it unreservably on behalf of a still-trusted colleague.”

“Ms. Dilley's conviction creates for her a depth of pain and embarrassment unique to her as a member of the Dilley family,” Pendery, her attorney, wrote in court documents.

Her grandfather started a law practice in Grand Rapids, and her father, Albert, invited her to attend law school and join the family firm after she graduated from the University of Michigan.

“There is nothing more painful for her than the disappointment she has brought to her family. There is nothing more painful for her than the footnote in the Dilley family history that she stood before the court also as a criminal,” her attorney wrote.
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There's a picture of me that is almost identical to the one of Ms. Dilley, in shock, tear-stained, shamed.  It's the US Marshal's booking photo taken after I entered my guilty plea.  Her US Marshal photo probably comes from her sentencing.  I feel her pain. 

There are obvious differences between Ms. Dilley's situation and mine.  She pleaded to a misdemeanor, my offense was one count of attempted tax evasion, a felony.  She received 8 months, I did 5 months. She was living a much more luxurious lifestyle by all indications, but we both clearly were in way over our heads and what was once prominent legal careers are gone. 

But, truth be told, there is life after the law.  It's not easy.  The financial stressors following a federal tax conviction may never go away, but one day at a time there are ways to resume a valuable life.  I found that attending meetings of the OurState Lawyers' Assistance Program and Alcoholics Anonymous where I share my experience with others and more importantly--get help.  I know this works for me and others say it helps them.  I have hope that maybe I will return as a licensed lawyer, someday--then again that may not happen.  I do know that whatever I end up doing my empathy for others, especially for those in legal peril has grown enormously.  Good luck. 

Hang in there. 

Brett Howard's Bread of Shame

The great Louisville Courier-Journal legal affairs reporter Andrew Wolfson has the account of the mortgage broker Brett Howard's credit spree/identity theft crimes in today's CJ.  Here's an excerpt from Wolfson's story which like all of Wolfson's stories is worth checking out:

"Handsome, charming and effervescent, Brett Howard had it all going for him as a mortgage broker for Louisville's HomeQuest Mortgage Network.In one month alone last year, he made $20,000 at the company in Middletown, according to one of its former partners. Howard drove a BMW and lived in a designer-decorated Old Louisville home with a 'casual chic environment,' the Voice-Tribune of St. Matthews wrote in September in a story about his housewarming party.

But Howard wanted more — and he allegedly took it, according to police and court records.

Using credit card numbers he allegedly stole from 19 clients, Howard, 21, embarked on a luxury goods spending spree last year, according to an indictment against him in U.S. District Court in Louisville.

According to court papers and Louisville Metro Police Detective Steve Glauber, Howard bought a $2,900 suit at British Custom Tailors, an Apple computer and Godiva chocolates. He bought $700 worth of clothes from Von Maur, $900 worth of shoes from Zappos.com and ran up a $2,100 bill at one of the fashionable W hotels.

Howard flew himself and a significant other to New York, bought tickets for a Broadway show and shopped at Saks Fifth Avenue. He even allegedly used one of the purloined card numbers to make a $250 donation to the Louisville AIDS Walk, according to Glauber and court records.

'He was a piece of work,' Glauber said in an interview.  But the bill is coming due.

Indicted on 19 counts of aggravated identify theft and 19 counts of fraud, Howard is set to enter a guilty plea Nov. 15 in U.S. District Court, where he faces a mandatory minimum penalty of two years in prison.  Howard's friends and acquaintances describe him as engaging but self-centered.


'He always had a very, very inflated sense of self,' said Justin Chelf, an Internet entrepreneur who attended Howard's party in September. 'He wanted it all, and he wanted it fast.'

Glauber said Howard acknowledged that he was living beyond his means when he was arrested last November — wearing one of the custom suits allegedly purchased with a stolen credit card number.  'He looked like a million bucks,' Glauber said.

HomeQuest, an on-line mortgage company, says on its website that it maintains 'appropriate security measures' to keep information it collects from clients private and that it hires 'only the most qualified mortgage consultants that are dedicated to our mission of putting each client's best interests above their own.'

CEO Jerry Van Slavens and former managing partner Paul Knopf said Howard was following standard procedures when he asked loan applicants for their credit card numbers to pay for third-party appraisals of their homes that are required under federal mortgage law.  But from September through November of last year, according to the indictment, Howard allegedly used those numbers to buy 'luxury extravagant type items,' Glauber said, running up total charges of $16,444.

Some of the victims were Howard's own friends, who had come to him for mortgages or to refinance their homes, said Chelf, who ran for the Louisville Metro Council on Tuesday in District 19.

A taste for sushi

The scheme was detected when a Laurel County schoolteacher, Karen Jones, who was one of Howard's clients, noticed a charge on her credit card for sushi, along with the custom-tailored clothing.

'I don't eat that,' Jones said in an interview.

Howard, by contrast, says on his Facebook page that sushi is the one food he could eat 'every day for two weeks and not get sick of.'

Jones said she had visited Louisville when the credit card charges were incurred but that her budget — her husband is a state park ranger — limits her shopping to 'J.C. Penney and maybe the Gap on a good day.' Another HomeQuest client noticed that Broadway show tickets had been charged to his card, according to Knopf, who said he normally wouldn't have suspected Howard of wrongdoing 'in a million years' because he seemed 'very innocent.'  But Knopf said the complaint about the tickets aroused his suspicion because he knew Howard had requested time off to go to New York in a few weeks.

Knopf also said he called the theater ticket broker, who said Howard had listed his college e-mail address when the tickets were purchased.

Howard, who grew up in New Albany, told the Voice-Tribune that he was a recent transplant from Myrtle Beach, S.C., and a student at the University of Louisville.

On his Facebook page, he said he has five televisions in his house on South Brook Street. Responding to the theoretical question, 'Would you allow one of your little fingers to be cut off for $200,000?' he says, 'Honestly, I think I would.'"
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This is a classic case of the concept of Bread of Shame.  It will be interesting to see how Mr. Howard's life develops.  Certainly it does not sound like there is a strong moral code at work.  It also sounds like there is a profound emotional disorder that is sometimes labeled narcissism.  Wolfson notes in another part of his story about this character that while at school Howard penned an essay on "trust" by which Howard seems to have meant the loyalty of others.  He does not appear to understand the concept of "trust."

On the other hand, he is a young man, and I have seen amazing transformations in my life and the lives of others.  Miracles do occur.

The Bread of Shame or Every Road Is a Toll Road

The guy in the picture is Melbourne Mills, the Kentucky Supreme Court permanently disbarred him despite an acquittal on fraud charges stemming from his participation in the theft of millions of dollars stolen from clients involved in fen-phen settlements and verdicts. Two of his close colleagues are doing +20 year prison terms for their roles in the theft of millions of dollars from clients.  The story is a nearly perfect example of the concept, Bread of Shame which can be expressed another way:  every road is a toll road.  The following is an excerpt from Andrew Wolfson's article at the Courier-Journal's website:

In a unanimous opinion, the Kentucky Supreme Court said it was stripping Mills of his license for violating 17 ethics rules, including taking more than $100 million in fees, with Shirley Cunningham Jr. and William Gallion, from Kentucky's $200 million settlement of the state diet-drug case.

Cunningham and Gallion were permanently disbarred in 2008.

Lexington attorney Angela Ford, who won a $42 million civil judgment against the three lawyers on behalf of their former clients, said in a phone interview that she would have been surprised if the court imposed a sanction of less than permanent disbarment for Mills.  But she said the court, by holding Mills accountable for failing to step in and stop the other two lawyers, sent 'a strong message on the duties of co-counsel -- you can't protect yourself by turning your head.' He was found not guilty after claiming at a criminal trial that he was too drunk to have joined in the conspiracy of co-defendants Gallion and Cunningham.

But a Kentucky Bar Association hearing officer found that [Mills] was cogent enough to have understood his duties, and the Supreme Court said that while [Mills] had misgivings about the propriety of the settlement, [Mills] took no immediate steps to stop it.

Under their contingency-fee contracts, Mills, Cunningham and Gallion should have been paid about $60 million of the $200 million settlement. Instead, they took $94.6 million for themselves and others, including consultants, administrators and lawyers, and put another $20 million into the foundation, which Cunningham and Gallion and others paid themselves to manage.

Cunningham and Gallion were convicted of fraud and sentenced last August to 20 and 25 years in prison, respectively. Cunningham, who is at a federal minimum-security prison in Yazoo, Miss., is eligible for release Aug. 15, 2025. Gallion, who is in a medium-security prison in Glenville, W.Va., has a release date of Dec. 8, 2029.
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Get this, these attorneys obtained a settlement entitling them to $60 million dollars, but that was not enough.  They wanted and they took $34.6 million dollars more.  

The idea of Bread of Shame relates to the unmerited receipt of value or wealth.  In the broadest possible sense this is seen with inheritance by the children of wealthy families from those who earned wealth to those who do not or did not earn the wealth.  The concept Bread of Shame holds that those who obtain their "bread" without earning it feel shame and can not enjoy or appreciate the value of what they obtain.  The sense of shame is a form of payment, because the other concept as suggested by my rowdy friends--is that every road is a toll road. 

This latter idea was suggested when were talking about he stolen artwork from the Musée d'Art moderne de la Ville de Paris that occurred toward the end of last week.   Works by Picasso, Monet, Modigliani and Nevadomi were targeted or taken. Some genius, moi, was saying the only possible sane buyer for these famous works of stolen art is the insurers.  An admirer of this art who obtained them under false pretenses, could not possibly enjoy the art knowing that they were stolen and that anyone else who shared an admiration for the works would also know that the works were stolen.  Where is the feeling of joy that comes with possession of something so corrupt or logically so inherently dangerous to mere proximity? 

You see, you never get away with any bad act--even willful blindness as in the case of Melbourne Mills and the theft of millions of dollars in attorney fees; or, as in my case, with my blindness to my law office and tax obligations.   As my friends say, every road has its toll.  You will pay the toll whether you think you blew by the booth and no one noticed or not.  Perhaps it is a sense of shame, knowing that you have what you did not earn, or that you will pay a rate that is even more dear than you dreamed. 

There are times when the price paid for Bread of Shame has no known proximate relationship to the cost incurred like health and damage to reputation.  In the Hebrew story of King David, the King, God's favorite, paid a painful price for his sin with Bathsheba, and his crime against Uriah the Hittite.  You can be King and not enjoy the Bread of Shame.