SAN FRANCISCO – Richard Carroll Sinclair, an attorney who practices in Oakdale, was disbarred on March 18 due to engaging in a fraudulent real estate scheme, seeking and obtaining loans on false pretenses, skimming off loan proceeds, rental income, tenant deposits and other fees and making misrepresentations to courts to conceal and further the scheme to defraud, according to the State Bar of California.
The official State Bar of California document also explained that Sinclair caused an altered trial exhibit to be submitted in a civil matter and failed to obey a court order by not paying $1,150 in sanctions in a civil matter and did not report those sanctions to the State Bar.
In the disciplinary proceeding, the report explained that Sinclair was charged with multiple counts of professional misconduct.
“The charged misconduct includes: creating a scheme to defraud; submitting an altered trial exhibit; making misrepresentations at trial; maintaining unjust actions; failing to obey court orders; and failing to report a judicial sanction,” the document said. “In light of the serious nature and extent of respondent’s misconduct, as well as the aggravating circumstances, the court recommends that respondent be disbarred.”
In the proceeding, the court heard testimony from Sinclair, Andrew Katakis and Daniel Durbin. The court also considered the “voluminous exhibits” presented by the parties.
The court explained that Sinclair was given a fair opportunity to contradict, temper, or explain the evidence and testimony from the civil proceedings with additional evidence; however, the court found much of Sinclair’s testimony was not credible and detailed the series of infractions perpetuated by him.
“Sinclair and his spouse purchased land with expectations of building an apartment complex for the production of rental income,” the court document said. “After the purchase of the raw land Sinclair obtained approval from the city of Turlock to construct a 35-unit townhouse complex known as Fox Hollow.”
The document explained a series of convoluted schemes that started with Sinclair obtaining a construction loan. The construction of the apartment complex began in 1989 and was completed in 1991. In July 1992, Sinclair defaulted on the loan. Several months later, despite the pending default, he transferred Fox Hollow to Sinclair Enterprises, which he and his wife owned. One week before the sale, Sinclair Enterprises transferred Fox Hollow back to Sinclair and his wife and then an hour after the transfer deed was recorded, they both filed for bankruptcy.
What ensued was a series of convoluted schemes and obstructions to avoid persecution and admission of wrong-doing, according to the report.
“In aggravation, [Sinclair] committed multiple acts of misconduct and caused significant financial harm to his client,” the court said. “In the Fox Hollow matter, the trial and appellate courts concluded that [Sinclair’s] and the other plaintiffs’ conduct constituted a pattern of misconduct and deception.”
Furthermore, the court said Sinclair’s actions demonstrated his indifference toward rectification or atonement for the consequences of his misconduct. Despite overwhelming evidence to the contrary, Sinclair continued to stress that he did nothing wrong and saw himself as the victim.
“Further, [Sinclair] has not taken any steps to rectify the harm he has caused,” the court said. “Consequently, [his] indifference toward rectification or atonement for the consequences of his misconduct warrants significant consideration in aggravation.”
Sinclair’s misconduct resulted in significant harm to Katakis and the administration of justice, costing Katakis more than $1.3 million dollars in attorney’s fees and has taken a toll on his emotional and physical well-being while trying to unravel Sinclair’s patterns of misconduct.
“The most severe sanction says that disbarment or actual suspension is appropriate for an act of moral turpitude,” the court said.
Despite the evidence against him, Sinclair argued for exoneration and dismissal.
Sinclair’s argument was dismissed and the court decided to disbar him.
“Disbarment often has been imposed in instances, such as here, where an attorney has engaged in a pattern of serious misconduct because ‘only the most serious instances of repeated misconduct over a prolonged period of time’ are characterized as demonstrating such a pattern,” the court said.