An attorney who cooperated with prosecutors in convicting a former state senator has been suspended for three years by a Brooklyn appeals court that faulted him for not helping officials sooner.
The Appellate Division, Second Department, on Wednesday said Carl Lodes of Carmel had “ample opportunity” to tell authorities about then-State Senator Vincent Leibell’s years-long kickback scheme targeting him and another attorney, but failed to do so.
“Rather, law enforcement authorities approached him,” the panel wrote in Matter of Lodes, 2012-09592. “Just as [Lodes] wore a wire in or about 2010, he could have done so at an earlier time.”
Lodes, the Putnam County attorney from 1991 to 2008, had asked for public censure, noting an otherwise unblemished disciplinary record and the fact that authorities viewed him as a victim and witness in Leibell’s acts, not as a subject or target.
But the panel said Lodes committed a “blatant breach of the public trust, from which he personally benefitted.”
Lodes’ suspension takes effect May 30.
Leibell, also an attorney, knew Lodes since about 1975. Lodes became the county attorney in 1991, while Leibell was a state Assembly member.
According to the disciplinary ruling, in February 2000, Leibell, by then a state senator, directed Lodes to tell a second attorney that he had to hire Leibell as a consultant for a “substantial sum” if he wanted to retain legal service contracts with the county.
Lodes did so, “and came to believe that the attorney made substantial cash payments to Leibell,” the ruling stated.
In an affirmation Lodes submitted in Leibell’s criminal case, he said Leibell told him that if he failed to pass along Leibell’s demand, Leibell “would see to it that neither [Lodes] nor Attorney #2 would be working for Putnam County.”
The following year, Leibell helped bankroll Putnam County Foundation, a non-profit corporation that develops local senior housing, with funding from member items. Lodes was the organization’s part-time executive director and legal counsel from December 2001 to April 2005.
Lodes began submitted invoices and was paid by the organization for his legal work in December 2003. Whenever Lodes was paid, Leibell insisted on getting half of the pay in the form of cash.
After meeting his demands for more than a year, Lodes refused Leibell’s kickback in January 2005, and was replaced as the organization’s counsel. Lodes said in his affirmation that he avoided Leibell for the next five years.
According to court papers filed by federal prosecutors, by April 2010, law enforcement agencies were helping a grand jury investigate allegations that Leibell had demanded and received illegal payments from people doing business in Putnam County.
When Leibell became aware of the probe, he met with Lodes—identified as “Attorney #1″ in court papers—several times. In taped conversations, Leibell told Lodes, “You and I say there was never any cash relationship. Period. Since you and I are in agreement, it didn’t happen.”
Leibell pleaded guilty and received a 21-month sentence in May 2011. The Second Department disbarred Leibell in June 2011.
The grievance committee served Lodes with a petition laying out six charges of professional misconduct in October 2012. The charges included allegations that Lodes “engaged in illegal conduct, which adversely reflects upon his honesty, trustworthiness or fitness as a lawyer” and that he “failed to comply with his obligation as an attorney to report his knowledge of another attorney’s conduct.”
Special Referee Jerome Becker sustained the charges.
Becker said it was “hard to imagine a clearer or more shocking breach of public trust, and an attorney’s ethical obligations, than the ones committed by [Lodes]” who, the referee said, “ participated in a kickback scheme by conveying Vincent Leibell’s extortionate demands.”
Becker said Lodes was “uniquely positioned” to put a stop to Leibell’s action, but did not.
“Disturbingly, the respondent’s silence appears to have been motivated by a conscious choice to prioritize, protect and preserve the stations and benefits acquired from his association with Leibell over the requirements and obligations of his profession,” Becker said.
Lodes did not dispute Becker’s findings when the referee sustained the charges. But Lodes said he “strongly disagree[d]” with Becker’s “ characterization of [his] conduct and character.”
In mitigation, Lodes expressed remorse and said he fully cooperated with disciplinary and governmental officials, who did not give him immunity in the criminal matter. Lodes said the misconduct was limited in scope, he stopped it on his own accord in 2005, and performed on a perceived threat to his livelihood.
Lodes was not charged with any crime in connection with the Leibell case.
Given the media coverage of Leibell’s case, Lodes said he and his family already faced “terrible condemnation,” especially in the community where he lived and worked.
The panel said it agreed with Becker’s view of Lodes’ conduct and did not find credible Lodes’ assertion that he didn’t report Leibell’s conduct because he thought he no one would believe him.
“Moreover, the purported threat to his livelihood was never realized, even when he independently stopped acceding to Leibell’s demands,” the panel wrote.
Lodes was represented in the appeal of the Becker’s findings by Richard Maltz of Manhattan.
In an interview, Maltz said Lodes would not appeal the decision and was now “contemplating his future.” Nevertheless, Maltz said Lodes had been dealt a “harsh” sanction “in light of the unusual and compelling mitigation” offered, pointing in particular to the letter Southern District prosecutors sent to Lodes about his role as a “victim” and “witness” in Leibell’s case.
Forrest Strauss appeared for the grievance committee.