Sidley Austin offices in Washington, D.C.
Sidley Austin offices in Washington, D.C. (Photo: Diego M. Radzinschi/ALM)

According to the FBI agent who investigated him for six years, Joseph Garcia preferred to remain a mystery.

Garica and his wife used multiple aliases to go along with numerous Social Security numbers. While peddling phony investments, Garcia would only reference his time as a Navy SEAL; the details were confidential. And he instructed his family to always have “go bags” packed should they need to flee one of the many lavish homes they rented across the country.

Garcia, whom FBI agent Marcus Kirkland testified never served in the military, pleaded guilty last year to a criminal wire fraud charge, receiving a 37-month sentence.

Another interesting question about Garcia: How did his relationship with a prominent Sidley Austin partner lead to allegations that the firm aided and abetted fraud?

The firm and partner Edward McNicholas in Washington, D.C., were named in an October 2016 complaint that alleges McNicholas worked with Garcia to lead a California woman to invest more than $6 million in what the suit claims was a bogus investment. Last week, Sidley’s lawyers in Chicago asked a Cook County Circuit Court judge to send the case to arbitration and said the charges were “utterly without merit.”

According to the complaint, Carrie Birkel met Garcia at a restaurant in California and two weeks later, unprompted, Garcia provided her with photographs of her husband in a “compromising position” with another woman. Garcia then introduced Birkel to McNicholas, whom she later paid a $25,000 retainer to help her vet divorce lawyers.

McNicholas serves a co-leader of Sidley’s privacy, data security and information law practice, according to a biography page on the firm’s website. He did not return a request for comment. Nor did Birkel’s lawyer, Edward Clinton Jr. of The Clinton Law Firm in Chicago.

After Birkel’s divorce led to a $10 million settlement, the complaint states that McNicholas and Garcia began discussing with her a potentially lucrative investment in a defense contractor named ToyBox. McNicholas told Birkel, according to her complaint, that he was going to leave Sidley to become general counsel at the company, which he allegedly said was set to receive a large government contract.

In October 2014, Birkel invested $5 million in ToyBox and provided another $1 million loan to the company, documents in the case show. Her total investment, including legal fees she advanced for the company, was $6.3 million, according to exhibits attached to Birkel’s complaint.

But as was the case with other shoddy investments that Garcia marketed, the complaint claims he used Birkel’s money to fund his lavish lifestyle.

He paid two years’ rent for a home in Orange County, California worth $800,000; bought luxury cars; and transferred other money from ToyBox’s accounts to his own, according to Birkel’s complaint. She has since recovered nearly $4.8 million and is suing Sidley and McNicholas to recover the remaining $1.5 million from her investment in ToyBox.

Sidley declined to comment about the firm’s alleged work for Garcia. But court documents and testimony by Garcia’s former accountant indicate the relationship between the con man and the Chicago-based Am Law 100 firm were not limited to Birkel’s case.

One of Garcia’s companies, Strategic Intelligence Services, is listed on the engagement letter signed by McNicholas and Birkel. Garcia used a business card with Sidley’s logo that listed him under one of his aliases, “Joseph Dean,” with his title as “special projects.”

According to testimony by his former accountant in his criminal case, Garcia had “24-7” access to Sidley’s offices after the accountant said Garcia spent “several weeks” counseling the firm’s clients on data security issues. Dean’s email address ended with “sidleyconsulting.com,” which is not typical of the firm’s email addresses. (Internet domain name registration records show that Karen Ransom, Garcia’s wife, who also pleaded guilty last year to a fraud charge, registered the sidleyconsulting.com name in 2014. It expired on Jan. 29.)

Garcia was under investigation by the FBI for the duration of his work with Sidley, according to testimony by Kirkland, the FBI agent handling his criminal case.

The criminal case that Garcia pleaded guilty to in the Southern District of Georgia in September 2015 involved activity similar to the allegations made by Birkel.

According to his plea agreement in the Georgia case, Garcia solicited investments worth $30,000 by promising a “bank guarantee” of a 300 percent return. The money was not put toward actual investments, but instead used personally by Garcia. He rented a home in the posh Washington, D.C., area known as Embassy Row for $12,000 a month. His home in Coronado Beach, California, cost $6,000 a month, according to court testimony. At the time of his arrest in 2015, the FBI estimated Garcia had access to $6 million.

The federal judge in Savannah, Georgia, overseeing Garcia’s bail hearing ordered him held in custody.

Noting he “reflects all the hallmarks of a sophisticated fraudster,” U.S. Magistrate Judge G.R. Smith said, “I just don’t trust him.”

U.S. District Judge Lisa Godfey Wood, who handled Garcia’s criminal case, ordered that he undergo a mental health examination, which remains sealed, due to bizarre behavior in the courtroom, according to court records. Smith said Garcia had difficulty recounting his Social Security number; wasn’t aware of his age; and testified that he had “holes” in his memory resulting from head trauma suffered during a prior incarceration. Garcia also repeated his contention that he served in the military.

While Garcia’s actions in his criminal case bear resemblance to the civil claims made by Birkel, the victims in the Georgia matter were different than the California divorcee. Many were not wealthy.

Rebecca Norman said in a phone interview that she took $30,000 out of a retirement account to invest in Garcia’s scheme. She is listed as one of more than 20 individuals who are owed a total of $635,000 in restitution from Garcia. The loss of the money contributed to difficulty funding her retirement and a divorce. Norman said she continues to struggle with the emotional trauma of the fraud.

“It never goes away,” she said. “It’s like a death.”

Garcia, 50, is scheduled to be released from prison in October of this year, according to the Federal Bureau of Prisons. He is currently incarcerated in a medium security federal correctional institute in Florence, Colorado, about 90 miles south of Denver.

Sidley’s McNicholas has been a partner at the firm for more than 16 years, according to his profile on professional networking website LinkedIn. He spoke with sibling publication LegalTech News earlier this month about the Internet of things and its impact on the discovery process in Big Law.

Copyright The American Lawyer. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

According to the FBI agent who investigated him for six years, Joseph Garcia preferred to remain a mystery.

Garica and his wife used multiple aliases to go along with numerous Social Security numbers. While peddling phony investments, Garcia would only reference his time as a Navy SEAL; the details were confidential. And he instructed his family to always have “go bags” packed should they need to flee one of the many lavish homes they rented across the country.

Garcia, whom FBI agent Marcus Kirkland testified never served in the military, pleaded guilty last year to a criminal wire fraud charge, receiving a 37-month sentence.

Another interesting question about Garcia: How did his relationship with a prominent Sidley Austin partner lead to allegations that the firm aided and abetted fraud?

The firm and partner Edward McNicholas in Washington, D.C., were named in an October 2016 complaint that alleges McNicholas worked with Garcia to lead a California woman to invest more than $6 million in what the suit claims was a bogus investment. Last week, Sidley’s lawyers in Chicago asked a Cook County Circuit Court judge to send the case to arbitration and said the charges were “utterly without merit.”

According to the complaint, Carrie Birkel met Garcia at a restaurant in California and two weeks later, unprompted, Garcia provided her with photographs of her husband in a “compromising position” with another woman. Garcia then introduced Birkel to McNicholas, whom she later paid a $25,000 retainer to help her vet divorce lawyers.

McNicholas serves a co-leader of Sidley’s privacy, data security and information law practice, according to a biography page on the firm’s website. He did not return a request for comment. Nor did Birkel’s lawyer, Edward Clinton Jr. of The Clinton Law Firm in Chicago.

After Birkel’s divorce led to a $10 million settlement, the complaint states that McNicholas and Garcia began discussing with her a potentially lucrative investment in a defense contractor named ToyBox. McNicholas told Birkel, according to her complaint, that he was going to leave Sidley to become general counsel at the company, which he allegedly said was set to receive a large government contract.

In October 2014, Birkel invested $5 million in ToyBox and provided another $1 million loan to the company, documents in the case show. Her total investment, including legal fees she advanced for the company, was $6.3 million, according to exhibits attached to Birkel’s complaint.

But as was the case with other shoddy investments that Garcia marketed, the complaint claims he used Birkel’s money to fund his lavish lifestyle.

He paid two years’ rent for a home in Orange County, California worth $800,000; bought luxury cars; and transferred other money from ToyBox’s accounts to his own, according to Birkel’s complaint. She has since recovered nearly $4.8 million and is suing Sidley and McNicholas to recover the remaining $1.5 million from her investment in ToyBox.

Sidley declined to comment about the firm’s alleged work for Garcia. But court documents and testimony by Garcia’s former accountant indicate the relationship between the con man and the Chicago-based Am Law 100 firm were not limited to Birkel’s case.

One of Garcia’s companies, Strategic Intelligence Services, is listed on the engagement letter signed by McNicholas and Birkel. Garcia used a business card with Sidley’s logo that listed him under one of his aliases, “Joseph Dean,” with his title as “special projects.”

According to testimony by his former accountant in his criminal case, Garcia had “24-7” access to Sidley’s offices after the accountant said Garcia spent “several weeks” counseling the firm’s clients on data security issues. Dean’s email address ended with “sidleyconsulting.com,” which is not typical of the firm’s email addresses. (Internet domain name registration records show that Karen Ransom, Garcia’s wife, who also pleaded guilty last year to a fraud charge, registered the sidleyconsulting.com name in 2014. It expired on Jan. 29.)

Garcia was under investigation by the FBI for the duration of his work with Sidley, according to testimony by Kirkland, the FBI agent handling his criminal case.

The criminal case that Garcia pleaded guilty to in the Southern District of Georgia in September 2015 involved activity similar to the allegations made by Birkel.

According to his plea agreement in the Georgia case, Garcia solicited investments worth $30,000 by promising a “bank guarantee” of a 300 percent return. The money was not put toward actual investments, but instead used personally by Garcia. He rented a home in the posh Washington, D.C., area known as Embassy Row for $12,000 a month. His home in Coronado Beach, California, cost $6,000 a month, according to court testimony. At the time of his arrest in 2015, the FBI estimated Garcia had access to $6 million.

The federal judge in Savannah, Georgia, overseeing Garcia’s bail hearing ordered him held in custody.

Noting he “reflects all the hallmarks of a sophisticated fraudster,” U.S. Magistrate Judge G.R. Smith said, “I just don’t trust him.”

U.S. District Judge Lisa Godfey Wood, who handled Garcia’s criminal case, ordered that he undergo a mental health examination, which remains sealed, due to bizarre behavior in the courtroom, according to court records. Smith said Garcia had difficulty recounting his Social Security number; wasn’t aware of his age; and testified that he had “holes” in his memory resulting from head trauma suffered during a prior incarceration. Garcia also repeated his contention that he served in the military.

While Garcia’s actions in his criminal case bear resemblance to the civil claims made by Birkel, the victims in the Georgia matter were different than the California divorcee. Many were not wealthy.

Rebecca Norman said in a phone interview that she took $30,000 out of a retirement account to invest in Garcia’s scheme. She is listed as one of more than 20 individuals who are owed a total of $635,000 in restitution from Garcia. The loss of the money contributed to difficulty funding her retirement and a divorce. Norman said she continues to struggle with the emotional trauma of the fraud.

“It never goes away,” she said. “It’s like a death.”

Garcia, 50, is scheduled to be released from prison in October of this year, according to the Federal Bureau of Prisons. He is currently incarcerated in a medium security federal correctional institute in Florence, Colorado, about 90 miles south of Denver.

Sidley’s McNicholas has been a partner at the firm for more than 16 years, according to his profile on professional networking website LinkedIn . He spoke with sibling publication LegalTech News earlier this month about the Internet of things and its impact on the discovery process in Big Law.

Copyright The American Lawyer. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.