USA V. James P. Roti, 06-3192. Saddled with a judgment for more than $400,000 on account of a guarantee of his small corporation’s debts, James Roti decided to hide his assets from creditors. He has been convicted of bankruptcy fraud, see 18 U.S.C. §157, and concealing assets from the bankruptcy trustee, see 18 U.S.C. §152. His sentence is 21 months’ imprisonment.
Roti concedes that he parked some assets with family members and moved others to accounts unknown to his creditors, and that he lied to his principal creditor, to the federal bankruptcy court, and to the trustee. Roti says that his lawyer Andrew Werth put him up to it, and at trial he contended that he should be acquitted because Werth managed the scheme’s details.
The jury rejected that defense-for it was no defense at all.
That two people cooperate to swindle a third does not excuse either of the schemers, even if one of them is a lawyer. Advice of counsel is not a free-standing defense, though a lawyer’s fully informed opinion that certain conduct is lawful (followed by conduct strictly in compliance with that opinion) can negate the mental state required for some crimes, including fraud. See United States v. Sprong, 287 F.3d 663, 665-66 (7th Cir. 2002).
But Roti does not contend that Werth assured him that concealing assets and lying to the court would be lawful. Roti did not call Werth as a witness or introduce any opinion letter. So it is hard to understand how Werth’s role, whatever it was, can negate scienter.
One observation before we close. Roti is in prison, but Andrew Dean Werth remains licensed to practice law. According to the Attorney Registration and Disciplinary Commission of Illinois, he is in good standing and no disciplinary inquiry has ever been conducted. If Roti’s testimony at trial is correct, however, then Werth planned and executed a federal crime for which Roti has taken the fall.
Neither knaves nor fools should be representing debtors who need legal assistance. We will send copies of this opinion (and of the briefs, which provide additional factual detail) to the ARDC and the disciplinary committee of the federal district court so that appropriate inquiries can be made into Werth’s fitness. In asking these bodies to conduct an inquiry, we do not express any opinion about whether Werth has engaged in sanctionable conduct.
For the full opinions visit the 7th Circuit Court of Appeals Web Site.
For more about attorney Michael J. Petro, visit www.mjpetro.com .